AAPL Q2 Estimates

  • Avatar

    Posted: 24 March 2012 07:04 PM

    By request, for anyone who is interested… smile

    [ Edited: 24 March 2012 10:28 PM by lovemyipad ]      
  • Posted: 24 March 2012 08:31 PM #1

    38 million iPhones

         
  • Posted: 24 March 2012 08:41 PM #2

    roni - 24 March 2012 11:31 PM

    38 million iPhones

    God I hope so.  I have to admit I never thought they’d sell more than last quarter this quarter, but lots of people seem to expect it.  I’m no expert -  I was totally surprised by the amount of iPhones sold by AT&T and VZW respectively last quarter.  As in, when I saw their individual numbers I didn’t see how aapl could sell what was expected.

    Does anyone have any detail on how people like Dawn Treader and Horace arrive at their estimates for iPhone sales?

    I got burnt along with countless others when I listened to some of the estimates being thrown around last October.  So I’m still pretty cautious.

         
  • Posted: 24 March 2012 08:54 PM #3

    StillLong - 24 March 2012 11:41 PM
    roni - 24 March 2012 11:31 PM

    38 million iPhones

    God I hope so.  I have to admit I never thought they’d sell more than last quarter this quarter, but lots of people seem to expect it.  I’m no expert -  I was totally surprised by the amount of iPhones sold by AT&T and VZW respectively last quarter.  As in, when I saw their individual numbers I didn’t see how aapl could sell what was expected.

    Does anyone have any detail on how people like Dawn Treader and Horace arrive at their estimates for iPhone sales?

    I got burnt along with countless others when I listened to some of the estimates being thrown around last October.  So I’m still pretty cautious.

    I arrived at mine thusly:

    The past two years there have been sequential iPhone increases from FQ1 to FQ2.  FQ1 this year was 14 weeks.  I figured a 10% increase and adjust it for a 13 week quarter.  Then I rounded up to the nearest million smile

    [ Edited: 24 March 2012 09:21 PM by roni ]      
  • Avatar

    Posted: 24 March 2012 09:24 PM #4

    When I look at estimates, I monitor both YOY and sequential.  Historically the Jan-Mar qtr is a weaker period, but as China gains the largest purchase season for China is tied to gift giving of Chinese New Year.  I try to track manufacturing capacity as a top level number realizing that as a product ages, the manufacturing efficiencies should increase the units available and improve the margin.  A launch qtr for any new product is an educated guess at best because you don’t know how the ramp is going or what the target unit number is for the unit ramp.  I’m in Aysmco’s camp in that it appears based on Apple’s capital spend they are targeting around 100%  YOY growth but then iPhone 4 and 4s ramped at different times in the calendar year.  The launch period has a pre build of unknown weeks to provide initial supply for the launch countries so I look at numbers of countries/ supply points and how quickly Apple adds additionally rollouts.  At some point in the cycle we get an idea of true demand, but the ramp normally takes 3-4 months so for iPhone we are pretty much in supply/demand balance and most of the rumors point toward a build in capacity.  Last year we had QoQ growth due to Verizon and China, This year we have added additional carriers which is a net positive.  I track carrier adds with subscribers, 3G, and population so I can do some numbers on additional potential subscribers.  I use an initial 6% target penetration of a carrier base for iPhone.  I’m still looking at numbers this week, but my pre qtr numer was about 34M.

         
  • Avatar

    Posted: 24 March 2012 10:07 PM #5

    One of the biggest variables in this qtr and the next is, how many carriers are added worldwide during the qtr…...something very tough to monitor accurately.  This qtr Apple added China Telecom, who has 130 million customers, to the mix in early March among others.  That’s a carrier 1.3X the size of an ATT or Verizon.

    I think the street would be very impressed with any sequential iPhone growth and anything over 14 million for the iPad.

    Signature

    Tim Cook: iPad is 91% of all tablet web traffic. I don’t know what these other tablets are doing.

         
  • Avatar

    Posted: 24 March 2012 10:27 PM #6

    I’m at $12 EPS for the time being.

    Don’t underestimate the impact of the 14-week quarter on fiscal Q1’s results.

    [ Edited: 24 March 2012 10:30 PM by Mav ]

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
  • Avatar

    Posted: 24 March 2012 10:45 PM #7

    pats - 25 March 2012 12:24 AM

    When I look at estimates, I monitor both YOY and sequential.  Historically the Jan-Mar qtr is a weaker period, but as China gains the largest purchase season for China is tied to gift giving of Chinese New Year.  I try to track manufacturing capacity as a top level number realizing that as a product ages, the manufacturing efficiencies should increase the units available and improve the margin.  A launch qtr for any new product is an educated guess at best because you don’t know how the ramp is going or what the target unit number is for the unit ramp.  I’m in Aysmco’s camp in that it appears based on Apple’s capital spend they are targeting around 100%  YOY growth but then iPhone 4 and 4s ramped at different times in the calendar year.  The launch period has a pre build of unknown weeks to provide initial supply for the launch countries so I look at numbers of countries/ supply points and how quickly Apple adds additionally rollouts.  At some point in the cycle we get an idea of true demand, but the ramp normally takes 3-4 months so for iPhone we are pretty much in supply/demand balance and most of the rumors point toward a build in capacity.  Last year we had QoQ growth due to Verizon and China, This year we have added additional carriers which is a net positive.  I track carrier adds with subscribers, 3G, and population so I can do some numbers on additional potential subscribers.  I use an initial 6% target penetration of a carrier base for iPhone.  I’m still looking at numbers this week, but my pre qtr numer was about 34M.

    Spot-on insights, IMHO, Pats! Thanks for sharing. You have to figure, given the China mobs at the 4s launch, that supply available will have determined sales.  My mantra has been China Holiday 4s on the front-end of the quarter and new iPad launch on the back end = some very strong upside surprise. I’m imagining the “reality distortion” possibility that Apple’s typically worst-performing quarter may edge out for top rank the previous quarter’s best-ever results…  But, SHHHHH, let’s keep this an AFB secret and let everyone else be surprised…

    Signature

    Study the natural order of things and work with it rather than against it…  ? Tao Te Ching

         
  • Avatar

    Posted: 25 March 2012 12:25 AM #8

    Quick Post..  more tomorrow.

    iPhones 41000

    EPS $ 12.90.

         
  • Avatar

    Posted: 25 March 2012 12:37 AM #9

    41 million iPhones!  Wow.

    What’s your assessment of the 14th week of fiscal Q1, though?  Let’s assume that week added 3M in sales, making for a normalized 34M had we had a 13-week quarter.

    A sequential increase of 7M or about 20%?  Not saying it’s not possible, but interested in your thoughts on how you arrived at a pretty significant jump.

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
  • Avatar

    Posted: 25 March 2012 01:17 AM #10

    I could be wrong, but I think I also recall TC saying on the earnings call that the extra 14th week at the end of the quarter was also a traditionally strong week of sales. So that traditionally strong week is robbed from Quarter 1.

    Does anyone think Christmas had a large effect on iPhone sales? I’m thinking it must have bumped numbers at least 10%.

    Hoping I’m wrong, but I’m currently thinking iPhone sales closer to 30 million than 40 million.

    Signature

    Full Disclosure:

    - Long Apple
    - Pro: Apple HDTV, iPhone Air, Stock split, Consumer robotics

         
  • Posted: 25 March 2012 02:23 AM #11

    Burgess - 25 March 2012 04:17 AM

    I could be wrong, but I think I also recall TC saying on the earnings call that the extra 14th week at the end of the quarter was also a traditionally strong week of sales. So that traditionally strong week is robbed from Quarter 1.

    Does anyone think Christmas had a large effect on iPhone sales? I’m thinking it must have bumped numbers at least 10%.

    Hoping I’m wrong, but I’m currently thinking iPhone sales closer to 30 million than 40 million.

    Please remember by extending the December quarter to the end of the calendar year, the 13-week March quarter ends on the 31st (next Saturday). This allows an additional shipping week for the iPad this year (versus the quarter cutoff last year) and allows for Apple to better meet demand on iPhone 4S supply.

    There’s no doubt the 14th shipping week benefitted the numbers in the December quarter. But revenue continues to rise at a frenetic rate and the March quarter ending with the close of the month will benefit the quarter’s revenue and earnings performance.

         
  • Avatar

    Posted: 25 March 2012 02:49 AM #12

    While I’m not sure about a 40 million number I’m very confident that 30 million isn’t in the cards.

    The prior year compare is 18.65M iPhones.  30M units would represent less than 60% growth.  Tank the stock?  I’m thinking yes.

    I don’t think growth will show THAT much all of a sudden.  Apple did significantly better than 100% growth fiscal Q1 after all.

    [ Edited: 25 March 2012 04:01 PM by Mav ]

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
  • Posted: 25 March 2012 12:16 PM #13

    I expect Q2 EPS $12.5 ; will up the trailing one year EPS to 41.5 ; with some luck we could see AAPL @ $650

         
  • Avatar

    Posted: 25 March 2012 12:39 PM #14

    Mav - 25 March 2012 03:37 AM

    41 million iPhones!  Wow.

    What’s your assessment of the 14th week of fiscal Q1, though?  Let’s assume that week added 3M in sales, making for a normalized 34M had we had a 13-week quarter.

    A sequential increase of 7M or about 20%?  Not saying it’s not possible, but interested in your thoughts on how you arrived at a pretty significant jump.

    I did forget about the 1 week bonus effect so that may be a problem

    I am thinking that the manufacturers simply stopped making some models of phones freeing up space for iPhones.

    Also, I may have overestimated the stockpiling effect of last October. 

    Thanks for your insight.

         
  • Avatar

    Posted: 25 March 2012 12:42 PM #15

    afterglow - 25 March 2012 01:07 AM

    One of the biggest variables in this qtr and the next is, how many carriers are added worldwide during the qtr…...something very tough to monitor accurately.  This qtr Apple added China Telecom, who has 130 million customers, to the mix in early March among others.  That’s a carrier 1.3X the size of an ATT or Verizon.

    I think the street would be very impressed with any sequential iPhone growth and anything over 14 million for the iPad.

    I have a fairly simple method of tracking carrier adds, I use a spreadsheet by country of each carrier with total subscribers and then compare that list to the list of carriers provided by Apple in their support document.  http://support.apple.com/kb/HT1937, by looking at the date of the support document and comparing to my existing list, I can determine the number of potential new subs in a qtr, I am behind in updating this qtr, but I will post next week, if you want a copy of my spreadsheet send me a PM with your email address as it is too large to PM on this site.