In a new research note to clients, UBS analyst Timothy Arcuri reports that, despite the COVID-19 coronavirus outbreak, Apple’s iPhone production is up YOY with the company having built about 36 million units in Q1, a 4 percent increase in iPhone production versus the first calendar quarter of 2019 according to UBS numbers.
Looking forward, Arcuri is expecting the quarter ending in June to result in 38 million iPhones sold, versus the previous prediction of 40 million.
The production number revisions by Arcuri are all because of supply chain impacts on manufacturing and demand induced by the coronavirus. Arcuri expects production to return by the end of the first calendar quarter, with full production returning through the second calendar quarter.
“We keep our Mar. quarter estimate unchanged, which is 6% lower than Apple’s original guide and likely reasonable assuming 15-20% demand deterioration in China (anecdotal expectations) equating to 3-4% for overall Apple,” writes Arcuri. “We expect China demand to remain weak as the return to normalcy and confidence takes time and we expect the monthly smartphone data to be weaker in Feb and Mar compared to 28% YoY decline in Jan.”
MacDailyNews Take: Up, not down, despite today’s upside-down market action. This is why it’s nice, if you can, to always have some cash set aside to take advantage of these knee-jerk AAPL deep discount sales whenever they occur.
Two quotes regarding this continuing Wall St. correction over the COVID-19 coronavirus:
• People tend to fear the worst. It almost never happens. – MacDailyNews, May 14, 2019
• Be fearful when others are greedy. Be greedy when others are fearful. — Warren Buffett