“Apple’s latest iPhones cement its position as the premium smartphone brand. Apple bears never seem to understand why Apple is earning 92% of the profits of the smartphone industry,” Mark Hibben writes for Seeking Alpha. “There’s a good reason for this, and it’s not savvy marketing fueling the ‘next iFad.’ That explanation is so worn out.”
“The simplest explanation, the one that doesn’t require the convoluted rationalizations of the Apple bears, is that iPhones command a higher price because they’re better,” Hibben writes. “Benchmarks substantiate the superiority (in terms of processing speed) of Apple’s custom SOCs. The high adoption rate of iOS 9, now over 50% of all iOS users, substantiates the superiority of iOS compared to Android, in which the latest 5.0 release has a very low adoption rate of 15.9%.”
“Based on what I see in the quality of the iPhone 6s/6s Plus hardware and software, I’m very bullish for the December quarter. I expect that as consumers realize how strong the product is this year, demand will build,” Hibben writes. “I still expect iPhone sales to top last year’s very impressive December record, for y/y unit sales growth in the mid teens. The first weekend sales, if anything, are encouraging, not frightening, since they indicate that demand in China remains strong.”
Read more in the full article here.
MacDailyNews Take: With iPhone 6s/Plus currently pegged with 2-3 week shipping times, it seems obvious that demand is outstripping supply and quite possible that supply shortages hindered launch weekend unit sales which were record-setting regardless.
The only way for Apple to see more phones, is to make more phones. They have made more phones and dedicated more resources to this task, than ever before. Expect next year to increase this effort.
On some models, they have already caught up, but that’s okay. Because, again the point is, they will sell all of them. They have very good demand to manufacturing capacity, churning out 500K phones per day, (Foxconn’s figures.) So if they are short, it doesn’t take long to catch up.
Also, they are planning launching in more countries so they need stock of as many phones as possible.
see = sell
500K/day equals about 3.5 Million/week, 46 Million/quarter.
My production capacity estimate is about 4.5 Million/week (>700K/day) with production starting 6 weeks before launch. At this rate production equals sell through during the March quarter, with minimal layoffs during the June quarter (keeping a trained/experience production labor force in place long term).
If only we had portal technology.
Your calculations ignore the fact that FoxConn is only one of Apple’s contract assemblers of iPhones. Apple also contracts with Pegatron. So, estimate that Pegatron manufactures 300,000 iPhones a day, now your figure is 800,000 per day, including Foxconn’s number and you are looking 5.6 million per week which just misses the ~75 million total sold last year in the first quarter. . . add in your six week lead time gives us approximately 106 million iPhones being manufactured for first quarter availability this year. Apple can easily meet such a demand as may develop and it’s no wonder they feel comfortable opening in China on the same day as the US and adding 40 more countries this month.
Apparently they made enough also. I only got around to ordering a 6sPlus on the day everyone was picking theirs up. The order said delivery Oct 28-Nov 4. I figured I just should have ordered earlier, but it turns out it’s being delivered today.
The next bit of FUD will be a rumor about how Apple can’t keep up with iPhone demand due to some component shortages and that will stop Apple from selling more iPhones which will then cause the analysts to downgrade the stock. The thing is, none of this affects the current status but Wall Street seems to only focus on the future. Why? Because the future is unknown and easy to manipulate.
For some reason the future always works against Apple because that’s how they want it to be. Even if Apple sells a huge amount of iPhones today, the naysayers can point to tomorrow with doubt. Apple is seen as the company where tomorrow is always in doubt. The pessimism is strong in Apple.
I still have to shake my head the way the 13 million iPhones sold in a weekend was simply swept away as nothing. That is an amazing amount of profits. Boeing’s recent $7.4 billion jumbo jet multi-year deal with Russia is less than what Apple made in one weekend based on a $650 iPhone base price per unit and Apple will likely sell 60 million iPhones in total for a single quarter. However, Wall Street treats it like it was nothing at all. I honestly don’t get it.
That already happened two days ago, digitimes ran a story about how component orders were down and apple lost 4 a share, lol digitimes has the worst track record of any yellow sheet tech rag. But Wall street butt heads used it as an excuse to short apple.
Some analysts are trying to make out that 13 million iPhones sold in the first weekend was a fluke because they were also selling them in China, unlike last year when the iPhone 6 was delayed due to approval. However that assumption ignores the fact that last year there was en masse scalping going on to feed the Chinese market and it also ignores last quarters (Q3) results showing a 35% increase iPhone sales YoY.
I can see Apple getting near to 100 million phones sold in Q1 which is over 1million a day.
I have an iPhone 6…is the 6s worth breaking my contract or should I just wait for the 7??? Decisions, decisions…