Average smartphone replacement plan among 1,032 respondents in the U.S., U.K, China and Germany: 20.3 months.
From a note to clients by Barclays analyst Mark Moskowitz that landed in my inbox Wednesday:
Smartphone replacement cycles might not be lengthening as much as feared. 41% of survey respondents plan to upgrade their device within 12 months after original purchase date, while 77% plan to upgrade within 24 months. Based on survey results, the implied average replacement cycle is 20.3 months, which is lower than what we had expected given the slowing growth rates in global smartphones in the past year.
Battery life is top reason to upgrade device; OLED and VR/AR rank low. Device makers may need to promote how OLED can improve battery life. VR/AR ranked really low [1%], implying investor optimism around Apple’s efforts to build an AR/VR ecosystem could be overdone, similar to the AI bandwagon for IBM last year.
Maintain Equal Weight rating on Apple and $146 price target.
Note: Moskowitz would have placed 24th out of 27 in the last Earnings Smackdown if I hadn’t misplaced his estimates. My bad.