Ming-Chi Kuo: Scalpers paying up to 2X more for access to iPhone 14

From Kuo's Twitter feed, posted Friday:

(1/4) The demand for iPhone 14 in the Chinese market may be stronger than that of the iPhone 13 from the viewpoints of distributors/retailers/scalpers.

(2/4) My latest survey indicates that some Chinese distributors/retailers/scalpers have to pay the highest prepaid deposit ever for iPhone 14 to ensure a sufficient supply, implying the iPhone 14 demand in the Chinese market will likely be higher than expected.

(3/4) At present, in the Chinese market, the iPhone 14 prepaid deposit is significantly higher than the iPhone 13 and even twice as high in some areas.

(4/4) The iPhone 14 shipment forecast of component suppliers and EMS is about 100 million and 90 million units in 2H22, respectively. The solid demand for iPhone 14 in the Chinese market may reduce market concerns about the risk of the iPhone 14 order cut after the launch.

My take: Bodes well for fall. BTW, I'm coming to appreciate Kuo's access to China's distributors/retailers/scalpers network.

6 Comments

  1. Fred Stein said:
    And apparently only recently has Apple reached demand / supply balance.

    Wanna bet demand for the M2 MBA will exceed supply for quite a while, too?

    Wonder if KC Rajkumar’s $125 target includes such demand for Apple products. KC is correct that Apple is not immune to a recession. He likely overstates the impact of a recession on Apple buyers, who are better off as a whole.

    5
    July 15, 2022
  2. Michael Goldfeder said:
    It’s possible that these perpetual negative stories regarding weakness and cuts with iPhones and other Apple products being promulgated by less than reliable sources are finally going to be exposed for the nonsense that it is. The demand for chips put out recently by TSMC is a very solid indicator for this upcoming iPhone 14 release cycle.

    6
    July 15, 2022
    • Fred Stein said:
      Great points Michael, and good reminder that us FOB’s are atypical.

      Most people in the market and most analysts learn by sound bite, hence the success of short message services and WallStreetBets. Both Apple and TSMC have the best products and the best customers, globally. They both excel in countless ways to ensure their leadership. Those details get lost in the news.

      Generic econ or finance news, or rumors, influence the sound biters, and hence market behavior.

      3
      July 15, 2022
  3. Fred Stein said:
    OT:

    Per AppleInsider, Apple just launch music videos recorded in Apple studios world wide. Like Sunday night NFL, this could boost Apple TV+ and some day immersive 3D.

    Sports, Concerts, and Games in 3D from Apple – big.

    4
    July 15, 2022
  4. A smartphone is a necessity, not a choice or luxury. In developed countries this is true for nearly everyone older than 10 now. I recently spent several days in the White Mountains not using my phone at all. That turned out to be a colossal error.
    The choice to upgrade or stick with the phone you have now is easier with BNPL and various annual upgrade plans. Deciding to switch to Android elicits a laugh or ‘not a chance’ from everyone I query. The iPhone 14 will again break sales records.
    Related note: Apple’s primary chip fab, Taiwan Semi (TSM), just posted record profits. TSM crafts custom silicon for many firms but their largest customer is based in Cupertino.

    6
    July 15, 2022
  5. Bart Yee said:
    The iPhone 14 is the next step up for those who have iPhones 3 or more years old. This includes the iPhone XS, X, XR, 8, 7 in all sizes, and now OS support ended for 6S and below.

    This suggests a potential upgrade user population of some 250-300M and of course new users and Android switchers. Despite inflationary pressures and recessionary concerns, there is still a significant user group ready to upgrade. IMO, if Apple can hold the line on prices and deliver reasonable and sufficient iPhone production volume, iPhone 14 sales should be on par with current iPhone 13 sales strength. For those who are more budget conscious, discounted iPhone 13 and 12’s should still be viable options.

    As we have seen in the last year, carrier promotions will heavily influence new iPhone and 5G adoption. I do not expect carriers to cut back this year either.

    0
    July 16, 2022

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