Wedbush: iPhone X was ‘massive disappointment’ for Apple (video)

Analyst Daniel Ives, with a Street-high $310 Apple price target, tells CNBC it’s all about China.

From CNBC’s Power Lunch on Friday:

Last year was just a massive disappointment for Cupertino and Cook. I think what they realized is they went for the 4-digit phone—in terms of a thousand dollar price points—and that really backfired. This is really a mea culpa. They realized what they needed to go after, it’s really about China.

Even though last night was a black eye for tech, I think when you go into Apple’s earnings I think they could sort of take this baton. In our opinion, the stock goes meaningfully higher.

iPhone XR could be the key that unlocks Chinese markets, says tech analyst from CNBC.

My take: “Massive disappointment” is a massive overstatement, but Ives has two assets that make him catnip for CNBC: A Street-high Apple price target and a sack full of metaphors.

7 Comments

  1. John Kirk said:

    Let’s see. Most analysts predicted that the iPhone 8, not the iPhone X, would be the Apple’s best selling iPhone. That was pretty understandable, but that prediction was wrong. The iPhone X became Apple’s best selling phone — and remained their best selling phone — from the moment it made its appearance on the market.

    In addition, because the iPhone X was Apple’s premium offering, iPhone Average Sales Price went UP and Apple’s profits also went UP.

    So if the iPhone X was a massive disappointment for Apple, give me more of the same. There isn’t a company in the world that wouldn’t want to sell a “disappointment” like the iPhone X.

    3
    October 27, 2018
    • David Emery said:

      And it’s not clear to me how a 4 digit price in US Dollars is at all psychologically relevant to someone paying in Yuan.

      0
      October 27, 2018
      • John Blackburn said:

        Made me laugh out loud,.

        1
        October 27, 2018
      • Ken Cheng said:

        Ha, next year his excuse will be that in China, the new Xs Max broached the 5-figure yuan mark, which dampened enthusiasm.

        1
        October 27, 2018
  2. Gregg Thurman said:

    China has more people that can “afford” an iPhone X/XS than does the US.

    The Chinese wealthy are just like wealthy people the world over, they gravitate to expensive labels even though a nonbrand discount product may be just as good. An Omega watch keeps time just as well as a Rolex (maybe better) but the wealthy buy top tier luxury watches.

    The iPhone is an Aspirational product as well as extremely useful. What other handset would you describe as aspirational.

    Further, all those analysts that express worries about iPhone sales in China themselves are iPhone users.

    When will analysts ever recognize that 1.2 Biilion total population is >3X greater than 350 Million total population.

    Denigrating the buying power of the Chinese clearly demonstrates an ethnic bias.

    0
    October 27, 2018
    • David Drinkwater said:

      UN estimates 1.4 bn in China and 1.3 bn in India “yesterday“. 1.4 bn in China and 1.5 bn in India in 2030. Rounding errors appear to decrease the relative change in both countries: China small, not non-Zero; India large, but not huge.

      USA? Statistically irrelevant. But technically significant.

      0
      October 27, 2018
  3. Robert Paul Leitao said:

    Let’s look at some facts:

    For the fiscal year ended in September, Apple will report record revenue, record net income, record earning per share and iPhone unit sales in the period will rival the previous peak year that included the first release of larger-screen iPhones in FY2015. This is despite the fact ASPs in FY2018 were at record levels.

    Greater China is Apple’s 3rd largest revenue region, trailing both the Americas and Europe in revenue generation. Greater China is very important to Apple’s success, but let’s keep the region in perspective as a percentage of Apple’s aggregate revenue generation. In FY2017 Greater China represented about 20% of Apple’s reported revenue.

    Yet again, an analyst is focusing primarily on iPhone unit sales to drive Apple’s growth as if a lower-cost iPhone would somehow solve a “problem” that doesn’t exist. The iPhone Xr is among the highest priced iPhones Apple has ever released and the $749 starting price for the iPhone Xr models is greater than the starting price of the iPhone 7 and iPhone 8 series handsets at the time of their original release.

    If Apple’s FY2018 performance was somehow a “massive disappointment” for any individual or group, that alternative universe isn’t inhabited by the company’s customers, employees or shareholders.

    0
    October 27, 2018

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