Apple has once again surpassed analyst estimates, this time for its June quarter. Its iPhone sales exceeded all expectations, and the company is looking forward to a great fourth quarter. The positive guidance, as well as Peter Oppenheimer’s “we’re looking forward to a very busy fall” suggests that Apple will follow last year’s release pattern?at least with the iPhone?so you should start saving your money now for the next generation iPhone because the launch is nearing.
Apple’s 20 percent year-over-year growth came in spite of a channel inventory reduction. In addition, the U.S., Japan, and the U.K. all grew iPhone sales north of 50 percent. “We believe more favorable component pricing (NAND, HDD, LCD) and improved iPhone mix are tailwinds that help offset currency volatility and product transition costs in the September quarter,” Katy Huberty wrote.
Mark Moskowitz expects near-term growth from anticipated iPhone launches in September and a new iPad mini in October. “In such a case, we think any temporary pressure on gross margin related to new products is likely deferred to (the December quarter),” he said. “This dynamic could pressure gross margin, but we think that the offset is higher revenue growth.”
Needham & Company
Apple’s fourth fiscal quarter guidance suggests to analyst Charlie Wolf that Apple might introduce a next-generation “iPhone 5S” before the end of the quarter. But for now, he said the story for Apple among investors is, “What have you done for me lately?” “After a whirlwind of new product introductions in the fall of 2012, Apple has been virtually silent on the product introduction front for nine months,” he said. “That should change beginning in September/October with the launch of the next-generation iPhone and iPad.”
“These initiatives suggest that Apple should once again be able to enter new product categories in 2014, although it is difficult to imagine that they will be the revenue producers that the iPhone and iPad have turned out to be,” he said.
Following Tuesday’s results, Gene Munster admitted that the iPhone franchise is in better shape than he previously believed. He estimates that average selling prices on the iPhone 5 and iPhone 4S were unchanged, while price cuts on the iPhone 4 in emerging markets likely made the low-end handset’s average selling price drop 15 percent.
“We find it curious that flattish revenue guidance implies there may not be any greater pause ahead of the new iPhone this year than there was last year, despite Apple effectively previewing a launch timeframe — particularly interesting given the lowering of iPhone channel inventory, presumably to manage the transition and limit price protection,” analyst Maynard Um said.
“In fact, the better-than-expected margin guidance gives rise to concerns that the new iPhones could come either at the very end of the September quarter (and have no material impact in September) or is pushed to the December quarter,” analyst Chris Whitmore said.
As you can see, analysts were impressed and admitted that despite whispers claiming the iPhone is dead, the company still manages to sell an impressive number of iPhones each quarter.