Morgan Stanley analyst Katy Huberty is more confident Apple will release a lower priced iPhone after meeting with CFO Peter Oppenheimer, reports BusinessInsider.
Huberty wrote:
We also see several signs that a lower priced iPhone makes sense: 1) iPad Mini is expanding Apple’s customer base with 50% of purchases in China/Brazil representing new customers to the ecosystem. 2) Chinese consumers show a desire to purchase the latest version of iPhone (instead of discounted older generations). 3) iPhone 4 demand surprised to the upside in the December quarter. Even at a low 40% gross margin and 1/3 cannibalization rate, we see an “iPhone Mini” as incremental to revenue and gross profit dollars.
Notably, Topeka Capital analyst Brian White recently said he is "now confident that a lower-priced iPhone will be launched by Apple in 2013, possibly as early as June."
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Huberty wrote:
We also see several signs that a lower priced iPhone makes sense: 1) iPad Mini is expanding Apple’s customer base with 50% of purchases in China/Brazil representing new customers to the ecosystem. 2) Chinese consumers show a desire to purchase the latest version of iPhone (instead of discounted older generations). 3) iPhone 4 demand surprised to the upside in the December quarter. Even at a low 40% gross margin and 1/3 cannibalization rate, we see an “iPhone Mini” as incremental to revenue and gross profit dollars.
Notably, Topeka Capital analyst Brian White recently said he is "now confident that a lower-priced iPhone will be launched by Apple in 2013, possibly as early as June."
Read More