Analyst: AAPL to Beat Sept Quarter Guidance

by , 11:15 AM EDT, September 17th, 2007

American Technology Research analyst Shaw Wu expects Apple is on track for a strong September quarter. Apple sales have been so strong, in fact, that he expects the company will come in well above guidance.

"Based on our checks with supply chain sources, we believe Apple is on track to beat its guidance substantially," Mr. Wu said. "Our sources indicate broad strength across business lines and a favorable high-end mix."

Mac sales appear to be strong and driven in part by back to school sales and switchers with interest focused more towards Apple's higher end products. Mr. Wu raised his September quarter sales estimate from 1.95 million units up to 2 million units.

iPod sales are strong, too, and all of Apple's new models seem to be selling well. "We had anticipated strength from the new 'fat boy' nanos, but higher-priced iPod classics and iPod touches are also doing well," he said. Mr. Wu raised his iPod sales estimate to 11 million units for the quarter, up from 10.4 million.

iPhone sales appear healthy as well, and Mr. Wu is now projecting 900,000 units sold for the September quarter, up from 770,000. He commented "Contrary to fears with potential cannibalization from new iPods and backlash from an iPhone price cut, iPhone sales have regained momentum."

Mr. Wu is forecasting US$5.94 billion in revenue and $0.83 EPS for the quarter, up from $5.8 billion and $0.73. For fiscal 2008, he is now modeling $30 billion and $4.55 EPS, up from $29.5 and $4.25.

Mr. Wu is maintaining his "Buy" rating and $185 target price for Apple's stock. Apple is currently trading at $138.47, down 0.34 (0.24%).

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