FQ4 iPad Sales

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    Posted: 10 September 2011 09:28 AM #16

    Hannibal - 09 September 2011 02:52 PM
    pats - 09 September 2011 12:39 PM

    LGD iPad 2 panel shipments return to previous levels

     
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    Max Wang, Taipei; Joy Wan, DIGITIMES?[Friday 9 September 2011]

    LG Display (LGD) has seen its LCD panel shipments for Apple’s iPad 2 return to previous levels after solving quality issues, industry sources said. Its shipments of 9.7-inch iPad 2 panels went back up to four million units in August, and will stay at a similar level in September 2011, the sources added.

    LGD’s shipments of iPad 2 panels declined siginificantly to 2.5-2.6 million unuits in July from the previous monthly volume of about four million units due to problems with the backlight units (BLUs), prompting Apple to source more from Samsung Electronics and Chimei Innnolux (CMI), the source said.

    Samsung shipped nearly two million units of iPad 2 panels in July while CMI’s volume reached 450,000-500,000, the sources added.

    Apple’s iPad 2 shipments are expected to reach 12-15 million units in third-quarter 2011, which will benefit its suppliers.

    Despite regaining orders from Apple, LGD has reportedly reduced its overall utilization rate due to sliding shipments of LCD TV and notebook panels.

    pats,
    The way I read these numbers is that the iPad production rate has been at about 6.5M units per month since August 1st, implying—contrary to the muted summary conclusion of the article—that FQ4 sales will be well above 15M and FQ1 sales at least 20M (more if the panel production rate can keep accelerating). Such a conclusion relies on two (I believe reasonable) assumptions: That display panels are the limiting factors for iPad production and that Apple is still selling every iPad it can manufacture.

    Reasonable conclusion?

    Alan

    Edit: Missed the above post while I was writing this one, which seems to confirm the conclusion I was working towards.

    I put the July production around 5M, August was an increase 5.5-6M. CMI was trying to get to 1M panels and with Sammy at 2M and LG at 4M. We could get to 7M for Sep.  Not sure if the Foxconn number is a overall delivery or the current rate .  The number makes more sense if we look at it as the current qtrly run rate.  The touch panel suppliers have also had additional capacity brought on like TPK is showing 6M panels per month and Wintek was at 5.2M, not all are for the iPad, but not much else is selling so we definitely have capacity for a bigger number.

         
  • Posted: 10 September 2011 01:56 PM #17

    So now that many of you have established production rate predictions, what about actual sell-through.  Are we assuming that Apple is still selling every iPad they can produce?

         
  • Posted: 10 September 2011 02:26 PM #18

    Mikedmvp - 10 September 2011 04:56 PM

    So now that many of you have established production rate predictions, what about actual sell-through.  Are we assuming that Apple is still selling every iPad they can produce?

    Here is where channel inventory was at the end of Q3, from the conference call transcript.

    We ended the quarter with about 1.05 million iPads in channel inventory, a sequential increase of about 200,000, which was well below our target range of 4 to 6 weeks.

    It would not surprise me to see that increase some.  How much?  I don’t know, but it is a point I will be looking at in the next conference call. 

    How much of the channel inventory counts as sold, and how much of it is in Apple’s retail and on-line store channel, where it does not count as sold until shipped to a customer.  I think that is correct in terms of the definition of sold.

         
  • Posted: 10 September 2011 02:36 PM #19

    All recent reports on iPad production are very impressive, particularly the fact that LG has corrected its QC issues (see link below).  Further, recent iPhone sales holding strong with FQ3 2011 is very encouraging, not that I’m totally surprised.  I never subscribed to the notion that iPhone changeover would significantly impact sales ahead of, or within the quarter, when it occurred.

    Apple has the potential to upside surprise this quarter like few others before it.  Rather than participate with others here in growing the whisper #, I’ll probably refrain from publishing my own EPS estimate.  Unless we’re behind a paywall, I now think it’s probably counterproductive to post EPS estimates that do little but to build expectations—I’m speaking as an Apple shareholder who would love to see Apple beat WS like we haven’t seen before.  By any company, ever.

    In fact, I updated my EPS # over the last few days and made my bets accordingly yesterday when I bought the dip (and then some).

    http://www.macrumors.com/2011/09/09/lg-resolves-quality-issues-with-ipad-2-display-production/

         
  • Posted: 10 September 2011 02:40 PM #20

    I would add that I DO like price targets, given the multitude of variables involved, not the least of which are the vagaries of the stock market.

         
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    Posted: 10 September 2011 05:09 PM #21

    If it’s just a couple of us in the AFB talking shop in a fairly disorganized fashion, I don’t think we’ll be setting up AAPL for a fall.

    Hey, DT historically posted his indices 3 weeks in advance anyway, and PED will end up doing pretty much the same thing.

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