4aapl
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Post by 4aapl on Nov 14, 2018 19:00:07 GMT -8
The interesting thing here is running the numbers. (though the first part of the story, saying majority, conflicts with the second part saying more than 20% (though technically correct, you wouldn't say "more than 20%" if you meant "more than 50%") The company, which generates the majority of its revenue by selling parts to Apple, said Wednesday it’s projecting fourth-quarter sales of $480 million to $520 million. Last month, the company gave a forecast of $570 million to $610 million.
... None of the companies specifically cited Apple as the customer that reduced its need for components, but Apple is the largest customer and biggest revenue driver for all four, according to data compiled by Bloomberg. Qorvo gets 36 percent of revenue from Apple, Lumentum generates 30 percent, AMS receives more than 20 percent and Japan Display gets 55 percent.The cut in guidance of 90M is 14.7-15.7% of the original forecast. If Apple were 20% of the revenue and no other company was cutting (i.e. blame this all on Apple), that would mean Apple was cutting it's order by 75%!!! Something isn't right here. Maybe all companies are cutting orders by 10-30% due to something (tariffs, interest rates, global market pullbacks, etc)? The only way I see all of these big changes all being due to Apple is either interest in Apple's products falling off a cliff (haven't read about that), or Apple moving a lot of component manufacturing in house or near house (i.e. a friend)...but I don't really see that turn happening on a dime either. While I don't think Apple should be in the business of worrying about rumors, just as they have said they don't worry (much) about a 90 day period, I wonder if Tim is going to have to have another on-campus sit-down with Cramer or the like.
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Post by sponge on Nov 14, 2018 20:54:33 GMT -8
I think guidance of $93 billion indicates a significant drop in iPhone sales compared to the last year. Even if they beat we are looking at a 3% drop. If other products and service slow down in any way, then it would be tough to make up the difference given how large the iPhone share is in revenue. So there is plenty of reason to be concerned if a trend is starting to take shape. Parts and suppliers are not the story. Guidance was.
I think they will beat that number and give us decent guidance. Right now WS can't seem to believe that.
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4aapl
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Post by 4aapl on Nov 14, 2018 23:23:46 GMT -8
I think guidance of $93 billion indicates a significant drop in iPhone sales compared to the last year. Even if they beat we are looking at a 3% drop. If other products and service slow down in any way, then it would be tough to make up the difference given how large the iPhone share is in revenue. So there is plenty of reason to be concerned if a trend is starting to take shape. Parts and suppliers are not the story. Guidance was. I think they will beat that number and give us decent guidance. Right now WS can't seem to believe that. Average Selling Price is likely going to be down YOY. Last Q it was $793, with all the latest and greatest (and most expensive) iPhones available. Granted maybe not enough of them were available, but with the lower priced XR coming out, I would mostly expect the ASP to go down just a little, instead of eclipsing Q1 '18 ASP of $796. It just all depends on the product mix, and how much up-memoried iPhones sell. While they won't be giving the ASP, it still factors in. Looking at guidance, and then guidance vs actual for the past 32 quarters, Apple always was at least in range, and was mostly in the upper end of the range or beat the range. The range for this Q for revenue is 89-93B. Taking the middle sector, that's 90-92, vs 88.3 in Q1 FY'18. With GM estimates the standard 38-38.5, and a reduced share count of around 6.5%, it's likely EPS will be up (at least) 8-10%, for a 12 month trailing EPS of 12.18-12.26. Not too bad, though it is important for revenue and absolute earnings to beat the year ago quarter, as they should if they beat the lowest end of guidance. But sometimes it's nice to run some numbers, even with a conservative EPS growth of 10% annually, just to see where that leads. Though so much ends up with that P/E ratio, or "investor sentiment" if you like to picture it more directly, especially in relation to the erratic (and sometimes seeming irrational) pricing patterns of the market. I'd love to see a beat and decent guidance too, but that depends on how spending goes this holiday quarter. "It's the most wonderful time of the year"
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