UBS analyst Timothy Arcuri is out with a new investor note to look at Apple's performance as we enter March. In the note, obtained by Business Insider UBS describes why it believes that the "worst of the bad news" for iPhone sales is over in China and more.
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According to UBS data, Apple is starting to clear warehouse in China, while the supply chain "tone" is also improving. "While the March blend is still poor, the tone of the supply chain stays to improve and price reductions in China may begin to clear the channel inventory," Arcuri said.
UBS has increased its quarterly iPhone estimate from 32.5 million units to 34.5 million But this is not necessarily due to the increased success of the 2019 iPhones. Instead, Arcuri says the interest in the iPhone 8 Plus, and other older iPhones, "offsets" a decline in recent models.
Considering the higher sales of older iPhones in Instead of more expensive newer models, UBS has dropped the AAPL revenue estimate to $ 56.5 billion for the March quarter, the company had previously estimated $ 57.5 billion.
It's not all bad news for 2019 iPhones, though. Purchase estimates for the iPhone XR are actually on the rise to quarter by quarter, an unusual occurrence for an iPhone so late in its life cycle:
"While the March mix is still poor, the tone begins in the supply chain to improve, and price reductions in China may begin to clear the channel holdings, "Arcuri wrote. "Acquisition calculations for XR are actually now Q / Q in June – atypical for this late in a" new "model cycle (good near-term for QRVO), but reflective of stock burn.
After poor iPhone performance in China, Apple caused its revenue to be revised in Q1 2019, the company lowered iPhone prices in the country. In a recent interview, Tim Cook said that only time will tell how that strategy works for Apple in China.
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