Apple's Tuesday earnings call all about 2019 iPhone demand, analyst says
Ahead of earnings, GBH Insights' Daniel Ives sees 42 million iPhones sold, and no big surprises -- but predicts the real story is what Apple forecasts for 2019 demand.
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In a note published Monday and seen by AppleInsider, Ives predicts that Apple will announced that it sold 42 million iPhones in the third quarter, and predicted "no major surprises" in regards to sales numbers or gross margins. Ives sees Apple's forecasts about the 2019 iPhone demand, as well services numbers, the "main event" of Apple's earnings announcement on Tuesday.
Reiterating a note of his from May, Ives continues to see the "window of opportunity" to upgrade over the next 12 to 18 months at 350 million, with Apple needing to capture the majority of those in order to ensure a successful cycle, which will in turn prop up services demand.
For that cycle, Ives is with the consensus of most analysts, who see Apple introducing three iPhones this fall- two 5.8 inch to 6.5 inch OLED Plus models, plus a less expensive LCD iPhone. Ives sees their releases as staggered between three and six months.
"In terms of the quarter, we believe there could be some upside on the all-important services/software front along with ASPs potentially another bright spot and top-line catalyst," Ives wrote in the note. "In a nutshell, the Street is all focused on the demand trajectory for the September quarter and most importantly into 2019 with the trifecta of next generation iPhones on the horizon and the Street modeling iPhone shipments of roughly 220 million units, which could ultimately prove to be conservative in our opinion given the underlying demand drivers."
The analyst maintains a $200 price target and the rating of "highly attractive" for Apple's stock.
Heading into Apple's earnings announcement, recent surveys of analyst projections published last week see Apple announcing that it sold around 42 million iPhones in the third quarter, and will announce EPS growth of about 37 percent. Gene Munster, for one, predicted 42 million iPhones sold and said that the iPhone is "becoming a stable business."
Various analysts, as they often due in the third quarter, have labeled the quarter boring or insignificant, as it is the last quarter before the arrival of new iPhones.
This earnings announcement has been very different from the runup to earnings in the second quarter, when many analysts predicted a disappointing quarter plagued by soft iPhone demand. Apple went on to quiet doubters by beating those estimates.
In a note published Monday and seen by AppleInsider, Ives predicts that Apple will announced that it sold 42 million iPhones in the third quarter, and predicted "no major surprises" in regards to sales numbers or gross margins. Ives sees Apple's forecasts about the 2019 iPhone demand, as well services numbers, the "main event" of Apple's earnings announcement on Tuesday.
Reiterating a note of his from May, Ives continues to see the "window of opportunity" to upgrade over the next 12 to 18 months at 350 million, with Apple needing to capture the majority of those in order to ensure a successful cycle, which will in turn prop up services demand.
For that cycle, Ives is with the consensus of most analysts, who see Apple introducing three iPhones this fall- two 5.8 inch to 6.5 inch OLED Plus models, plus a less expensive LCD iPhone. Ives sees their releases as staggered between three and six months.
"In terms of the quarter, we believe there could be some upside on the all-important services/software front along with ASPs potentially another bright spot and top-line catalyst," Ives wrote in the note. "In a nutshell, the Street is all focused on the demand trajectory for the September quarter and most importantly into 2019 with the trifecta of next generation iPhones on the horizon and the Street modeling iPhone shipments of roughly 220 million units, which could ultimately prove to be conservative in our opinion given the underlying demand drivers."
The analyst maintains a $200 price target and the rating of "highly attractive" for Apple's stock.
Heading into Apple's earnings announcement, recent surveys of analyst projections published last week see Apple announcing that it sold around 42 million iPhones in the third quarter, and will announce EPS growth of about 37 percent. Gene Munster, for one, predicted 42 million iPhones sold and said that the iPhone is "becoming a stable business."
Various analysts, as they often due in the third quarter, have labeled the quarter boring or insignificant, as it is the last quarter before the arrival of new iPhones.
This earnings announcement has been very different from the runup to earnings in the second quarter, when many analysts predicted a disappointing quarter plagued by soft iPhone demand. Apple went on to quiet doubters by beating those estimates.
Comments
so Apple could have this quarter look somewhat better by having them out slightly earlier (if production allows!) and the next quarter slightly worse. Since the next quarter is the blowout sales quarter, it might be better to eat a small number of sales by doing the adding this coming quarter.
Apple will sell all it can make through September, but it won't be until Q1 2019 estimates come out at the first of November that we get a true idea of the long-term demand.
As a side note, I still don't see a 6.1" LCD model being introduced, especially in the $600 - $700 price range being bantered about. The iPhone 8 ($699 - $799) and iPhone 8 Plus ($799 - $899) have held their own quite well competing with the higher priced iPhone X ($999 - $1149). Unit sales haven't been hurt by the higher priced iPhone X. To the contrary, December quarter iPhone units sold since December quarter 2014 have averaged 76.213 Million, with a paltry 1.882 Million Standard Deviation. Apple has proven the $999 (minimum) price tag of the iPhone X to be a successful price point. So, why introduce a new large screen (larger than an iPhone 8 Plus) unit for a price LOWER than the current iPhone 8 Plus? This is not Apple's way.
so much for not using JavaScript! I don’t do much of this on my iPhone so it doesn’t matter. But elsewhere, it’s needed. Too bad.
https://www.apple.com/investor/earnings-call/
https://sixcolors.com/post/2018/07/apple-q3-results-charts-call/