Other analysts are looking forward to a big September uptick. Not Hall.
From a note to Goldman Sachs clients that landed on my desktop Friday:
Mainland China handset shipments weak in August. According to the China Academy of Information and Communications Technology (“CAICT”) data, handset shipments in the country were 24.3m units in Aug’21 (-15% M/M and -10% Y/Y). Although August tends to be a low demand month we note this is also down materially on the 32.6m and 30.9m units shipped in Aug’18 and Aug’19. This continues the ongoing trend of weak overall demand in China that we believe relates mainly to the market reaching full penetration.
iPhone 12 cycle still lower than iPhone X redesign cycle. Based on the CAICT’s disclosure for handset shipments from local brands in the country, we calculate that shipments in China from international vendors were 1.5m units in Aug’21, down from 2.5m units last year. We believe Apple shipments constitute the majority of these international shipments. This number is also down in comparison to levels seen in Aug’18 (2.3m) and Aug’19 (1.9m). Aggregate iPhone 12 cycle shipments (Sept-Aug) now total 43.7m compares favorably to 36-37mn units for the same time period in 2018 and 2019. This is down 13% on the iPhone X redesign cycle (2017/18) for the same time period.
Maintains Neutral rating and (underwater) $140 price target.
My take: To quote Evercore’s Amit Daryanani…
While August results were somewhat underwhelming and saw declines in both the market as a whole and in iPhone shipments, we would note that this likely points to a moment of pause in the weeks leading up to the iPhone 13 launch rather than a fundamental slowdown.