Apple (AAPL) iPhone 6 Unlikely Until Aug/Sept - UBS
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Price: $341.27 +0.09%
Rating Summary:
46 Buy, 28 Hold, 9 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 17 | New: 36
Rating Summary:
46 Buy, 28 Hold, 9 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 17 | New: 36
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UBS analyst Steven Milunovich weighed in on Apple (NASDAQ: AAPL) Monday, saying he doesn't expect the iPhone in the company's FQ3 and also expects an overall tough first half of 2014 but a better second half.
On the iPhone 6, Milunovich said supply check suggest a June launch now seems unlikely with an August/September launch most likely. He continues to see two models - a 4.7" and 5.5" with in-cell displays. "While the 4.7" seems certain, the 5.5" may or may not launch at the same time and could be of the same resolution (lower ppi), which would help app developers. iPhone 6 units are expected to exceed 5s sales year-over-year when it ships," he said.
The analyst said second-half iPhone demand could surprise to the upside. "Our iPhone model is up just 10mn this year at 172mn vs 162mn last year. China Mobile, which appears to be off to a slow start at about 1mn iPhones in Feb, could be sufficient to account for the entire change. The second calendar half may surprise to the upside if either China Mobile or the iPhone 6 gain traction. Although the iPhone 6 could carry a lower margin since we would be surprised if it is priced at much of a premium, unit demand could be strong as surveys suggest Apple users want larger screen sizes and carriers' 24-month enforced contracts roll off for 4s owners."
He sees risk, however, to the March and June quarters. "In the near term, we believe 1Q procurement, though not fully correlated to sell-in, is coming down a bit. In phones, the primary difference likely is the 5c, which has not sold well. Overall volumes are reflecting a maturing high-end smartphone market. iPad volumes appear to be lower than expected—recall that Dec quarter sell-through was only up 5% YoY. General tablet production is soft with some components down 20- 50% sequentially. We model iPad units declining to 19mn in Mar and 16mn in June. We are below consensus for Mar/Jun quarter revenue; no change in Apple estimates."
For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.
Shares of Apple closed at $532.87 yesterday.
On the iPhone 6, Milunovich said supply check suggest a June launch now seems unlikely with an August/September launch most likely. He continues to see two models - a 4.7" and 5.5" with in-cell displays. "While the 4.7" seems certain, the 5.5" may or may not launch at the same time and could be of the same resolution (lower ppi), which would help app developers. iPhone 6 units are expected to exceed 5s sales year-over-year when it ships," he said.
The analyst said second-half iPhone demand could surprise to the upside. "Our iPhone model is up just 10mn this year at 172mn vs 162mn last year. China Mobile, which appears to be off to a slow start at about 1mn iPhones in Feb, could be sufficient to account for the entire change. The second calendar half may surprise to the upside if either China Mobile or the iPhone 6 gain traction. Although the iPhone 6 could carry a lower margin since we would be surprised if it is priced at much of a premium, unit demand could be strong as surveys suggest Apple users want larger screen sizes and carriers' 24-month enforced contracts roll off for 4s owners."
He sees risk, however, to the March and June quarters. "In the near term, we believe 1Q procurement, though not fully correlated to sell-in, is coming down a bit. In phones, the primary difference likely is the 5c, which has not sold well. Overall volumes are reflecting a maturing high-end smartphone market. iPad volumes appear to be lower than expected—recall that Dec quarter sell-through was only up 5% YoY. General tablet production is soft with some components down 20- 50% sequentially. We model iPad units declining to 19mn in Mar and 16mn in June. We are below consensus for Mar/Jun quarter revenue; no change in Apple estimates."
For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.
Shares of Apple closed at $532.87 yesterday.
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