Upgrade to SI Premium - Free Trial

Apple (AAPL) iPhone 12 and 12 Pro Pre-Orders Beat iPhone 11 - Analyst

October 19, 2020 10:45 AM

Popular Apple (NASDAQ: AAPL) analyst Ming-Chi Kuo of TF International Securities said pre-orders of the iPhone 12 and 12 Pro beat that of the iPhone 11 series, although the iPhone 11 price cuts affected the pre-order demand for the iPhone 12.

Kou estimates pre-order sales of iPhone 12 and 12 Pro in the first 24 hours reach 1.7–2 mn units. This versus iPhone 11 series 500-800k units and iPhone 6 series of 4 million units.

The analyst said the delivery time for the iPhone 12, in most countries, is 5–10 days, implying the weaker-than expected
pre-order demand. However, they think that the price cut of the popular iPhone 11 affected the preorder demand for the iPhone 12.

"The iPhone 12 Pro pre-order beat our expectation because of Apple core fans’ initial preference for high-end models, the strong demand in the Chinese market, and the coming peak season demand in the US and Europe. The iPhone 12 Pro’s delivery time is 2–4 weeks in most countries," Kou commented. "The Chinese market accounts for 35–45% of worldwide demand. The reasons for the strong pre-order demand in China include 1) demand transfer of the high-end model due to Huawei ban, and 2) more popular 5G infrastructure to benefit the marketing and promotion."

The analyst estimates first weekend sales of iPhone 12 and 12 Pro will be 7–9 million units (vs. iPhone 11 series’ 10–12 million units, iPhone 6S series’ 13 million units, and iPhone 6 series’ 10 million units). "The initial shortage of the iPhone 12 Pro supply will limit the first weekend sales," he commented.

They believe that the pre-order and first weekend sales of iPhone 12 mini and 12 Pro Max will be lower than those of the iPhone 12 and 12 Pro.

Kou estimates that iPhone 12 mini, 12, 12 Pro, and 12 Pro Max will account for 10–15%, 30–35%, 30–35%, and 15–20% of iPhone 12 series shipments in 4Q20, respectively.

Kuo said the iPhone 12 pre-orders are likely to benefit Apple and the supply chain's recent stock rebound. However, for them to continue to rise depends on the supply and demand changes for the iPhone 12 and 12 Pro in November and the pre-order result of the iPhone 12 mini and 12 Pro Max, he added.

Categories

Analyst Comments