Apple December guidance, says RBC’s Amit Daryanani, may not even matter.
From a note to Royal Bank of Canada clients that landed in my inbox Sunday:
We think AAPL is positioned to print Sept-qtr results inline with street and guide Dec-qtr below expectations. Dec-qtr buyside expectations are ~75-80M iPhone units but overall revenues are expected >$80B (given higher ASP’s). What we think matters is AAPL’s commentary around supply constraints and path/timeline to alleviating them along with inherent steady state gross-margin expectations.
Simplistically, whatever AAPL guides for Dec-qtr is a reflection of their supply and not true end-demand, hence we see potential for Dec-qtr guide being below street but we see upside to march-qtr expectations as supply eventually catches up.
Net/Net: AAPL should outperform as data-points get positive & AAPL benefits from 1)ASP tailwinds from iPhone X and higher memory, 2) GM’s benefit from f/x, services and higher memory & 3) potential for AAPL to see rev/EPS growth not just for FY18 but also FY19.
Daryanani maintains his Outperform rating and $180 price target.
My take: Sounds about right. Whatever iPhone X orders get pushed back in December will pop back up by March.