Piper Jaffray: iPhone to resume growth in 2016 despite poor macroeconomy

“Explaining Tuesday’s earnings call, Piper Jaffray analyst Gene Munster said Apple’s repeated allusions to macroeconomic headwinds might have ‘spooked’ investors despite a better than expected guide on iPhone, but the analyst sees light at the end of the tunnel,” Mikey Campbell reports for AppleInsider. “”

“In a research note prepared following Apple’s earnings conference call, Munster pointed to AAPL shares trading down about 3 percent in after hours action, saying the company’s outlook on the world economy was more cautious than anticipated. By his count, CEO Tim Cook and CFO Luca Maestri mentioned negative macro trends nine times during prepared statements, and another four in the Q&A session,” Campbell reports. “‘While we were expecting some level of cautious macro commentary given the volatility in global stock markets, decline of commodity prices, and uncertainty in the Chinese economy, the level of caution described by Apple was greater than we would have expected,’ Munster writes.”

“Apple is guiding the first-ever decline in year-over-year iPhone sales for the current March quarter,” Campbell reports. “Munster is modeling March iPhone at 53 million units, down 13 percent year over year but better than an initial negative 17 percent estimate… Munster expects iPhone to be down 10 percent in the June quarter compared to 2014 and flat for the three-month period ending in September before returning to growth — 80 million units — in December. ”

Read more in the full article here.

MacDailyNews Take: Apple’s $18.4 billion quarterly profit is the largest ever recorded by a single public corporation.

SEE ALSO:
Apple highlights services in search of Wall Street’s love – January 26, 2016
Apple reaps $18.4 billion quarterly profit, the largest ever recorded by a single public corporation – January 26, 2016
Apple beats on earnings; sets all-time records for revenue, net income, and EPS – January 26, 2016
MacDailyNews presents live notes from Apple’s Q116 Conference Call – January 26, 2016
Apple beats Street with all-time record quarterly earnings – January 26, 2016

7 Comments

  1. Go to Yahoo finance and just read the headlines…you would think that Apple sold only 5 phones…you can’t fix stupid!
    If you’ve got a better place to invest your money, then sell, sell, sell! I’ll stay put.

  2. This is how Tim Cook should have conducted the Conference Call:
    1. Today we announced historic quarterly revenues and profits. But we have decided to discontinue payment of dividends and share buy-backs.
    2. We are going to invest all our resources (both within US and abroad) in expanding our new product development efforts, including M&A with the sole objective of diversifying the base of our enterprise.
    Now ladies and gentlemen please excuse me because I have work to do.
    If he had done this, Apple shares this morning would be atlas 10% higher.

    1. This is crazy. Apple already has a very diverse product line and services. The problem I’ve run into involves iCloud in particular (not to mention glitches with my Apple Watch). Apple doesn’t need to get bigger, it’s too big already! One hand doesn’t know what the other is doing to solve people’s very real technical issues with their services. Fix the leaks before you think of building a bigger ship.

  3. One point that seems to be overlooked is that difficult global trade conditions apply to all companies, not just Apple.

    Apple is well prepared for those challenging conditions and is also taking advantage of it’s cash surplus at a time when other companies might have to be more cautious.

    At a time when Samsung’s sales are falling sharply, maintaing level iPhone sales is no mean achievement. When PC sales are falling rapidly, selling increasing numbers of Macs is quite extraordinary.

    Most companies facing challenging sales conditions would be tempted to reduce selling prices or offer other incentives which would negatively affect profitability. Apple has not only maintained it’s sales, but has also increased it’s margins to a level that others could only dream about.

    Analysts obsess over iPhones sales trends, market share and revenue, but the most important thing for a company is to make profits and that’s achieved by a combination of sales volume and profit margin. Apple is a tremendously effective business by any standards except those of analysts.

  4. ditto to the above… with the PC and global smartphone markets shrinking in 2015 AAPL actually grew marketshare relative to the competition – just not YOY versus themselves. Now growing marketshare with a sticky ecosystem in a shrinking market- that is double delta bad for the competition.

  5. PED at Fortune has a list of who was close and who wasn’t. Gene Munster was in the top 5, Katy Huberty also did well. Credit Suisse Gulbinder was number 11. The bottom of the list was the most interesting; Turley Muller and Horace Deidu among them.

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