From a note to clients by analyst Amit Daryanani that landed on my desktop Monday:
ALL YOU NEED TO KNOW: November smartphone data points to continued growth in iPhone shipments following the launch of the latest generation of Apple’s flagship product. This is a large positive for Apple and marks continued recovery from October after the Sept-qtr saw an almost 30% drop in China revenue.
The broader Chinese smartphone market remains challenged with shipments down 17%, but MNC (read Apple) shipments were up 95%, significantly outperforming the broader market. The data set includes shipments broken down by domestic vs. multi-national companies. Apple likely accounts for greater than 90% of the multinational (MNC) shipments, so it serves as a reasonable proxy now that shipment data is no longer broken down by operating system.
Notably, JD recently indicated that it has seen very strong pre-order volume for the iPhone 12 Pro with over 500k pre-orders. In addition, our delivery time-line tracker indicates strong staying power for iPhone demand in China with the earliest delivery of the iPhone 12 Pro having increased slightly from last month at ~23 days. Finally, we would also note that we expect iPhone demand to remain STRONGER FOR LONGER given that the release of the 12 Mini and Pro Max should provide a second leg of demand.
Net/net: We expect growth to remain strong in December.
Maintains Outperform rating and $135 target.
Cue the Figures 1 and 2 (click to enlarge):
My take: This is the third take on China’s Ministry of International Trade and Industry November smartphone shipment report I’ve seen and the most positive yet.