“Apple could beat its quarterly record for revenue set at this time last year, on the strength of the iPhone, increased Mac sales, and services, one analyst believes,” Mike Wuerthele reports for AppleInsider. “But that growth could also be at the cost of 2017 expansion and a soft ‘iPhone 8’ demand.”
“Brean Capital analyst Ananda Baruah believes Apple is looking at a quarter where earnings will exceed $76 billion, topping the record set in Apple’s first fiscal quarter in 2016,” Wuerthele reports. “He also expects to see a slight increase in revenue gleaned from Mac sales in 2016 versus the year-ago quarter, with a continued drop in iPad sales, but offset by the release of the Apple Watch in September.”
“The firm believes that the growth will come at the expense of the next quarter,” Wuerthele reports. “While the firm is looking forward to the ‘iPhone 8,’ it points to a ‘lack of model clarity’ and ‘lack of super-compelling new features’ — the same as most analysts did with the iPhone 7 — for what it sees to be a muted demand for the new iPhone range in the fall of 2017.”
Read more in the full article here.
MacDailyNews Take: He had us until he went stupid on the tenth anniversary iPhone being anything other than spectacular and therefore facing “muted demand.” Puleeze.
[Thanks to MacDailyNews Readers “Fred Mertz” and “Dan K.” for the heads up.]
Nothing more than an “actionable research” note from an analyst trying to cause buy/sell in AAPL; they simply could not give a damn what retail investors do, as long as they transact to push up Financial Institution revenue. Investors that sit Long in AAPL are all but useless in the eyes of Financial Institutions, greedily taking the Dividends, without have concern for the poor analysts, their bosses and the all important year end performance bonus!!
Presumably that’s the same Ananda Baruah who in May 2016 predicted that iPhone sales would fall by 16 million units during 2016.
Well it better be for iPhones since it can’t be for “amazing new iMacs, a true pro-designed 2017 Mac Pro or pumped up Mac Mini.”
Apple has yet to confirm these numbers.
Apple is providing the following guidance for its fiscal 2017 first quarter:
revenue between $76 billion and $78 billion
gross margin between 38 percent and 38.5 percent
operating expenses between $6.9 billion and $7 billion
other income/(expense) of $400 million
tax rate of 26 percent
As of last night the iPhone 7/7 Plus according to Mixpanel was 22.3% of all iPhones being used. It took the iPhone 6s until the end of March 2016 (six months of sales) to reach this usage percentage.
By the end of this December quarter the iPhone 7/7 Plus will be around 24% of all iPhones being used. Apple is also selling other phones like the 6s. For Apple to only sell three million or so more iPhones than the last December quarter they would have to lose approximately 65 million iPhone customers in this quarter.
Losing that many customers is highly unlikely given the fact that the iPhone has a great customer satisfaction rating, although it has decreased in China recently. Let’s suppose the sat averages to be 88% worldwide, and let’s also suppose the iPhone upgrade cycle averages two years. This means about 9 million people that got an iPhone in the December quarter two years ago went with another brand this December quarter. Then there are millions more that purchased an iPhone from the secondary market. Some of these people also went other brands.
With an estimated 30 million users leaving the iPhone over the past three months, my median iPhone sales estimate up to last night of sales is approximately 95 million.
could u translate that please ? 😳
I posted a lengthy response, but for some reason it didn’t go through. Do you not understand what the usage percentage means, or do you want the math?
The math is complicated. Basically, I try to determine what users are upgrading from (various iPhone models). Then the number of used phones purchased by new people to the platform, or purchased by people already in the platform is determined. For example, let’s say a user has a 6, they purchase a new 7 and the 6 is sold to someone else. Is that someone else a new user to the ecosystem (coming from Android), or are they upgrading from a 5c or 5s?
I’ve been tweaking this spreadsheet for awhile. The numbers aren’t perfect, but based on estimates taken by Strategy Analytics (US only), and other data they should be fairly accurate. If you want to see my ratios let me know.
thanks for the additional explanation ✌️️
No problem. I added a supplemental to the original post. Having more than one set of eyes on this would be good.
To be clearer – the 30 million that left the iPhone and went with Android or something else is replaced by new people to the ecosystem. The following is how all the numbers breakdown. Keep in mind these are rough estimates:
– 430M iPhone base at the beginning of the December 2016 quarter.
– 430M base now
– 22.39% iPhone 7/7 Plus minus 3.91% from the previous quarter = 79,464,000
– iPhone 6s = 154,757,000 – 139,234,000 = 15,523,000
– iPhone 6 (sold in India) = 2,000,000
Total iPhone sold Dec ’16 quarter:
– 79,464,000 + 15,523,000 + 2,000,000 = 96,987,000
Calculate how many left the iPhone:
First calculate iPhone 7:
– 15% new = 11,919,600
– From previous iPhone = 67,544,000
– 10% from 6s = 6,754,440
– 50% from 6 = 33,722,300
– 40% from pre 6 = 27,017,760
– 6,754,440 + 33,722,300 + 27,017,760 = 67,544,000
Now calculate how many iPhones were sold back to the market or given as gifts, etc:
– 95% of 6s = 6,416,718
– 80% of 6 = 27,017,760
– 15% of pre 6 = 4,052,664
– Total = 37,487,142
Calculate how many of these devices were purchased by pre iPhone 6 customers:
– 37,497,142 * 70% = 26,240,999
Calculate the number of pre iPhone 6 devices that are no longer in use:
– (27,017,760 – 4,052,664) + 26,240,999 = 49,206,095
Do similar calculations for the 6s and determine how many pre iPhone 6 devices are no longer in use. This equals 12,170,032.
The total number of pre iPhone 6 that should no longer be in use is:
– 49,206,095 + 13,170,032 = 61,376,127
Calculate the actual number of pre iPhone 6 decrease:
– 100,405,000 – 15,222,000 = 85,183,000
It appears many pre 6 left the iPhone:
– 85,183,000 – 61,376,127 = 23,806,873.
Next calculate how many 6 customers left the iPhone:
– 7,002,808 retired – 2,000,00 purchased = 5,002,808
– Actual decrease = 9,804,000
– Number that left iPhone = 9,904,000 – 5,002,808 = 4,801,192
Total number of customers that left iPhone:
– 23,806,873 + 4,801,192 = 28,608,065
If Apple sold 78 million iPhones, instead of 97 million then the loss of customers would be 55 million. 55 million seems too excessive.
👍👍✌️️