J.P. Morgan: Qualcomm’s German win has ‘minimal impact’ on Apple

Analyst Samik Chatterjee says the iPhone stop-sale raises the likelihood of an eventual settlement.

From a note to clients that landed on my desktop late Thursday:

District Court of Munich in Germany issued a permanent injunction against Apple relative to the infringement of a Qualcomm hardware patent and has restricted Apple from selling specific iPhones in the country (iPhone 7, 7 Plus, 8, and 8 Plus)…

We estimate that the financial impact of Apple’s stop-sale is likely minimal given: 1) Germany accounts for only 3% of total global shipments; and 2) Apple owns only 15 stores in the whole of Germany, which we estimate will account for only a modest portion of total sales in the country from the direct channel relative to the global average of 30%. We would expect the impact to be less than 1 mn shipments on an annualized basis…

At this time, the ruling includes the iPhone 7, 7 Plus, 8, and 8 Plus; however, we believe based on our discussion with Qualcomm that the firm is looking to add newer iPhone models to the list as well.

Maintains Overweight rating and $266 price target. 

Apple’s statement:

We are of course disappointed by this verdict and we plan to appeal. All iPhone models remain available to customers through carriers and resellers in 4,300 locations across Germany. During the appeal process, iPhone 7 and iPhone 8 models will not be available at Apple’s 15 retail stores in Germany. iPhone XS, iPhone XS Max and iPhone XR will remain available in all our stores.

My take: Can’t we, at long last, just get along?


  1. Aaron Belich said:
    Too bad that doesn’t stop an iPhone user from selling their banned hardware to a new or existing AppleID when they replace said iPhones within the next 2-3 years.

    December 21, 2018
  2. Fred Stein said:
    The net effect, IF the ban holds up under appeal, will be too small to measure. Oh, I forgot, we can’t measure because Apple is not reporting iPhone sales.

    The second hand market may fill most of the demand in Germany for the older models as customers in Germany and elsewhere trade up to the X series.

    December 21, 2018

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