In a statement on Sunday, Apple warned that it expects lower-than-expected iPhone 14 Pro and iPhone 14 Pro Max shipments following a significant production cut at the factory. iPhone City” from its main assembler (Foxconn) in China due to the Chinese Communist Party’s chimerical “zero-COVID” lockdowns.
Brian Sozzi for Yahoo Finance:
If there’s one small silver lining in Apple’s iPhone production warning, it’s that recession fears haven’t stopped people from wanting $1,000 more new models and wait weeks to get them.
“Supply chain challenges have been frequent over the past two years, and there is little evidence that delays in device shipments have impacted overall volumes for a product cycle (example: iPhone 12 or iPhone 13) over a period of several quarters.” JP Morgan analyst Samik Chatterjee wrote in a note to clients.
Chatterjee explained that “in the hardware portfolio, we see demand destructions from supply surges the least for the iPhone as consumers are willing to wait for delivery; and would expect the delayed shipments to extend into F2Q23 (end March) or later quarters.
“We continue to see strong demand for the iPhone 14 Pro and iPhone 14 Pro Max models,” said the [Apple’s] statement said. “However, we now expect lower shipments of iPhone 14 Pro and iPhone 14 Pro Max than we previously anticipated.”
Chatterjee remained with an outperform rating on Apple with a price target of $200, but warned there was heightened risk to Wall Street analyst estimates for the current quarter.
MacDaily news note: In his note to clients, Chatterjee also wrote, “We see upside in several aspects of the business as well as financials that remain underestimated by investors, namely transforming the business into services, growing installed base, technology leadership and optionality around capital deployment – which together lead us to expect double-digit earnings growth and modest stock revaluation.
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[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]