Even with iPhone prices steady, analyst Samik Chatterjee expects 2019 sales to beat 2018’s by 4 million units.
From a note to clients that landed on my desktop Monday:
iPhone pricing a key watch point amidst noise around potential tariffs. The limited updates to the three 2019 iPhones expected to be launched tomorrow would have made it an opportune year for Apple to repurpose typical supply chain savings as well as outsized decline in memory prices (relative to at the time of the launch of 2018 iPhones) towards lower prices across the line up.
However, we expect Apple to maintain prices, driving additional levers relative to a potential tariff on iPhones, and in the absence of any tariffs a more moderate price increase for 5G enabled iPhones in Sep-20. While lower pricing for 2019 iPhones relative to our expectation could raise near-term volume outlook for C2019, it would drive medium-term risks relative to the impact of potential tariffs and 5G iPhone volume outlook.
Forecast volumes for 2019 iPhones in C2019 to exceed 2018, largely on account of timing changes of launches relative to last year. We forecast 2019 iPhone volumes sold in the remainder of this calendar year following general availability later this month to exceed volumes for 2018 iPhones in C2018 by roughly 4 mn units, largely driven by our expectation for general availability of all three new iPhones to be at the same time this year relative to a delay for the iPhone XR last year.
Maintains Overweight rating and $243 price target.
My take: Lack of last year’s iPhone XR’s delay is not a great reason for iPhone sales to increase.