Meanwhile, Apple’s iPhone X supply chain has started to accelerate.
From a note to clients by GBH Insights’ Daniel Ives:
Our team at GBH spent the weekend at Apple stores talking to customers and deciphering demand trends. Based on our store checks as of today, we have seen Apple stores essentially sold out of the iPhone X across many major cities in the US, with our checks in New York, Boston, Los Angeles, Philadelphia, San Francisco, Dallas, and Washington D.C. showing limited to no supply left as of Sunday afternoon.
While lines were stronger than we have seen in years across Apple stores and rivaled iPhone 6 first day build up, overall lead times have now shorted to 3-4 weeks from 5-6 weeks seen a few days ago, indicating that the supply chain has started to accelerate out of Asia and should now be able to find a balance of supply/demand hopefully by January/February 2018 if this trend continues.
We continue to believe global demand for iPhone X is outstripping supply by a 2:1 margin and now the biggest challenge for Cook and Apple will be to alleviate the supply chain in the near-term to help fulfill demand for holiday season. Based on our initial analysis and pre-order demand trajectory, we believe the current iPhone X cycle is tracking between 10%-15% ahead of the iPhone 6/6+, which has been Apple’s most successful product launch to date and is a positive data point for FY18 growth.
Maintains Highly Attractive rating and $205 price target.
My take: This is shaping up to be a monster quarter.