Apple (AAPL) Pre-Orders: iPhone X to Cannibalize iPhone 8 Orders, Apple Watch Now a Product to Keep Tabs On - KGI

KGI analyst Ming-Chi Kuo weighed in on pre-orders for Apple (NASDAQ: AAPL) iPhone 8 and Apple Watch Series 3.

Kuo said it is very likely that iPhone X demand will cannibalize iPhone 8 pre-orders. While it takes 3-6 weeks or more to ship new iPhone models after they are available for preorder, they see the iPhone 8 taking less than 1-2 weeks. This is due to the iPhone X cannibalization.

The analyst also notes significantly stronger-than-expected pre-order demand for Apple Watch Series 3’s GPS + Cellular version. He sees it now as a product to watch. To wit... "Before the media event, we forecasted the production weighting of the GPS + Cellular version would be 30-40%. However, the pre-order website shows shipments of this version are taking much longer than those of the GPS version (3-4 weeks, from shipments launch day of September 22). We estimate the preorder weighting of the GPS + Cellular version is 80-90%. While not available in all countries, most users have pre-ordered the GPS + Cellular version because it offers phone and internet access functions without an iPhone and given the low premium of US$70 over the GPS version." While Apple Watch shipments are well below
iPhone shipments, they recommend investors start keeping tabs on this product due to significant marked shipment growth.

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