Orders for Apple’s newly-launched 4.7-inch iPhone SE are better than expected, TF Securities analyst Ming-Chi Kuo wrote in a note to clients on Tuesday. However, he still predicts that iPhone shipments in calendar second quarter (April-June) could decline 20% or 25% year-over-year because of reduced demand stemming from the COVID-19 coronavirus pandemic.
Kuo argues that the strong reception for the iPhone SE suggests consumers are gravitating to lower-priced phones, which has implications for Apple’s business and the companies that supply it with parts.
“The most difficult challenge from COVID-19 for smartphone brands is the negative impact on consumer confidence or purchasing power after the pandemic outbreak, resulting in consumers preferring to choose lower price/spec models or to stop purchasing smartphones,” Kuo wrote.
Kuo argues investors in Apple and its supply chain should focus more on the effects COVID-19 is having on consumer demand, not Apple’s ability to launch new products.
MacDailyNews Take: There was considerable pent-up demand, so it’s not a shocker to see iPhone SE orders being strong. It is, after all, just the first week of pre-orders for the new iPhone which started on April 17th. The new iPhone SE will be available from Apple, Apple Authorized Resellers and select carriers on Friday, April 24th.