New FY2017 and FY2018 Apple EPS Projections, The iPhone's Monopoly, Apple Partnering with Ola
Today's Above Avalon stories:
- New FY2017 and FY2018 Apple EPS Projections
- The iPhone's Monopoly
- Apple Partnering with Ola
Today's email continues our focus on FY2017 and FY2018 Apple financial estimates. We go over my Apple revenue, operating income, and EPS projections. The discussion builds on previous updates focused on my revised iPhone unit sales estimates (available here), and iPad, Apple Watch, and Mac (available here). The email then turns to new data regarding Apple's significant share of operating income found in the smartphone industry. We go over a few of my thoughts and observations regarding the data and what it may mean for future iPhone pricing. The email concludes with a look at Apple partnering with Ola, the largest ridesharing company in India. We discuss the rationale for the partnership and the clues that hint at Apple's broader motive for working with Ola.
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New FY2017 and FY2018 Apple Watch, iPad, and Mac Sales Estimates
Today's Above Avalon stories:
- Apple Watch Sales Estimates
- iPad Sales Estimates
- Mac Sales Estimates
Today's email is focused on my new Apple Watch, iPad, and Mac unit sales estimates for FY2017 and FY2018. The discussion builds on yesterday's look at my revised iPhone unit sales estimates (available here). We begin by discussing my methodology for deriving Apple Watch unit sales estimates. The email then turns to the iPad business. Evidence is mounting that the iPad business has turned a corner in terms of unit sales growth. We go over my thoughts and observations as to the factors driving this change. The email ends with discussion on Mac sales estimates.
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Methodology for Estimating iPhone Sales, iPhone Installed Base Estimates, New 2017 and 2018 iPhone Sales Estimates
Today's Above Avalon stories:
- Methodology for Estimating iPhone Sales
- iPhone Installed Base Estimates
- New 2017 and 2018 iPhone Sales Estimates
Today's email is focused on iPhone sales. We begin by discussing my methodology for deriving iPhone unit sales estimates. The email then turns to the iPhone installed base. I share my estimates for the number of new iPhone users per year from 2007 to 2016, including my current estimate for the size of the iPhone installed base and user base. We conclude with my revised iPhone unit sales estimate for FY2017 and the introduction of my FY2018 iPhone unit sales estimate. We also go over my thoughts and observations on the concept of "Peak iPhone" and how the iPhone sales landscape looks over the next few years. FY2018 and FY2019 look very intriguing from an iPhone sales perspective.
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Apple Disbands Wireless Router Division, Amazon Chasing Live Sports, Apple's Texas Pawn
Today's Above Avalon stories:
- Apple Disbands Wireless Router Division
- Amazon Chasing Live Sports
- Apple's Texas Pawn
We begin today's email by discussing Bloomberg's article about Apple shutting down its wireless router team. We go over my thoughts and observations on the scoop and why I think Apple disbanded the group. The email turns to Amazon's quest for live sports programming. While the company is clearly showing remarkable ambition, Amazon is in a unique position to approach sports content differently than Apple and others. We conclude with The New York Times taking a closer look at Apple's Austin, Texas campus. Apple's desire to shine light on its Austin campus provides clues as to Apple's strategy for going up against Washington's new "putting America first" agenda.
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The Electric Car Ownership Head Fake, McLaren Confirms Talks with Apple, Odds of Apple/Tesla Partnership are Increasing
Today's Above Avalon stories:
- The Electric Car Ownership Head Fake
- McLaren Confirms Talks with Apple
- Odds of Apple/Tesla Partnership are Increasing
We begin today's email by expanding on the discussion kicked off in my article last week, "Skating to the Apple Car Puck." We go into greater detail on why I think there will be an electric car ownership head fake. The future of transportation is increasingly looking like a shared model. The email then turns to McLaren confirming it was in talks with Apple. We break down the latest news of a major McLaren management shakeup, with a focus on what it may mean for Apple. The email concludes with my thoughts on how Tesla's SolarCity acquisition will impact the probabilities of Tesla being an acquisition target for Apple. We also go over why the probability of Apple partnering with Tesla in the future has increased following Tesla's SolarCity deal.
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Snap's Intriguing Spectacles Rollout, Apple Cuts App Store Fees for Video Services, Thursday Q&A
Today's Above Avalon stories:
- Snap's Intriguing Spectacles Rollout
- Apple Cuts App Store Fees for Video Services
- Thursday Q&A
We begin today's email with a closer look at Snap's Spectacles rollout. We go over my thoughts and observations on the unique rollout and how Snap is trying to position Spectacles differently compared to the average tech gadget. We discuss what it may mean for the product going forward. The discussion then turns to news of Apple cutting App Store fees for video services that integrate with Apple's new TV app. We go over the implications such a move will have on Apple's video ambitions and Services business. We end the email with the latest installment of member Q&A, and I answer the following questions from Above Avalon members:
- If tariffs are added to all imported goods from China, is Apple prepared to start manufacturing the iPhone in the U.S.?
- Is it possible that Apple delayed AirPods to avoid overshadowing the Apple Watch Series 1 as this holiday season's top gift?
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Apple Releases New Design Book, Nostalgia vs. Inspiration, This Is Jony's Apple
Today's Above Avalon stories:
- Apple Releases New Design Book
- Nostalgia vs. Inspiration
- This Is Jony's Apple
Today's update is dedicated to discussing Apple's new design book, "Designed by Apple in California." We begin by going over the book's details, including how Apple treated the book like any other Apple product. We then go over my thoughts and observations about Apple's motivation and reasoning for such a book. The discussion includes the debate as to whether such a book is a sign of Apple embracing nostalgia or rather a form of inspiration. We then go over why I think this book reinforces the theory that we are watching Jony's Apple take shape. The email concludes with a discussion as to how Jony is influencing Apple, why I suspect Jony wanted to publish this book now, and what the book tells us about Apple design's future.
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Apple Exploring Smart Glasses, Phil Schiller Confirms Apple Innovation Feedback Loop, Samsung Buys Harman
Today's Above Avalon stories:
- Apple Exploring Smart Glasses
- Phil Schiller Confirms Apple Innovation Feedback Loop
- Samsung Buys Harman
We begin today's email by discussing Bloomberg's new report that Apple is developing a pair of smart glasses. We discuss a few issues that I had with the report and the big picture concerning Apple moving into AR glasses. The email then turns to MacBook Pro reviews and Phil Schiller's new comments about the Touch Bar. Schiller confirmed my Apple Innovation Feedback Loop theory. We look at what this means for the Mac going forward. We conclude with news of Samsung buying Harman, a U.S. automative technology manufacturer. We go over why I think the deal is a Samsung head fake.
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Deep Dive into Apple's 2016 10-K, Jimmy Iovine Hints at Original Music Content, Disney Turns Bullish on ESPN
Today's Above Avalon stories:
- Deep Dive into Apple's 2016 10-K
- Jimmy Iovine Hints at Original Music Content
- Disney Turns Bullish on ESPN
We kick off today's email with a closer look at Apple's 2016 10-K filing. The email goes over my notes (15 subtopics) from the filing. We then discuss a recent Jimmy Iovine interview with the WSJ that caught my attention. When the topic turned to the future of music streaming services, Iovine had a few interesting comments regarding original content. The email then turns to Disney's recent earnings call and the company turning remarkably more upbeat about ESPN's prospects. We go over Disney's change of tone and how it may fit into Apple's content strategy.
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The Perils of Being a Hardware Company, Preview of Apple Sales on Black Friday, Thursday Q&A
Today's Above Avalon stories:
- The Perils of Being a Hardware Company
- Preview of Apple Sales on Black Friday
- Thursday Q&A
We begin today's email with a closer look at Wall Street's skepticism about tech hardware companies. We go over Fitbit, GoPro, and Apple in terms of how each company is navigating the difficult path of relying on hardware-centric business models. The email then shifts to my thoughts and observations on this year's Black Friday sales on Apple products. While Apple won't likely directly participate in Black Friday sales, some of the major U.S. retailers released their promotions yesterday. There are a few takeaways related to Apple Watch and iPad. We end the email with the latest installment of member Q&A, and I answer the following questions from Above Avalon members:
- Is it normal for Apple executives to hold few shares of AAPL?
- Would Apple realistically want to bring all of its foreign cash back to the U.S.?
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Initial Thoughts on U.S. Election Impact on Apple, More Evidence for Strong MacBook Pro Demand, Apple Now Selling Refurbished iPhones
Today's Above Avalon stories:
- Initial Thoughts on U.S. Election Impact on Apple
- More Evidence for Strong MacBook Pro Demand
- Apple Now Selling Refurbished iPhones
We begin today's email by discussing the impact from the U.S. presidential election. Markets are jittery as a Trump presidency will usher in a new agenda and set of policies into Washington. We go over the major themes and topics to think about regarding the impact on Apple (both positive and negative). The email then turns to additional evidence of strong MacBook Pro demand. This has implications on gauging the fallout from the criticism pointed at the new MacBook Pro. We conclude with going over my thoughts on Apple selling refurbished iPhones in the U.S. There are some interesting takeaways from the move concerning global iPhone demand.
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The Microsoft Surface Strategy, Thoughts on Microsoft Surface Studio, NBCUniversal to Sell Ads in Apple News
Today's Above Avalon stories:
- The Microsoft Surface Strategy
- Thoughts on Microsoft Surface Studio
- NBCUniversal to Sell Ads in Apple News
We kick off today's email with a closer look at Microsoft's Surface Studio. The discussion begins with an overview of Microsoft's Surface strategy and then shifts to my thoughts on the Surface Studio. We also discuss my view on the Surface Studio representing compeititon for the Mac. The email then shifts to news of Apple partnering with NBCUniversal to sell ads in Apple News. We discuss the implications from the partnership and how it relates to the narrative of Apple wanting to become a services company. There are an increasing number of holes in the narrative.
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The Apple Innovation Feedback Loop, Apple Cuts USB-C Accessories Pricing, Early MacBook Pro Sales
Today's Above Avalon stories:
- The Apple Innovation Feedback Loop
- Apple Cuts USB-C Accessories Pricing
- Early MacBook Pro Sales
We begin today's email by continuing the discussion kicked off in my article last week, "Apple Is Placing a Big Bet with the New MacBook Pro." Specifically, we look at a new item that I coined, "The Apple Innovation Feedback Loop," which ends up revealing much about Apple's plans for the Mac and the main takeaway from the new MacBook Pro. The email then turns to Apple slashing pricing for USB-C/Thunderbolt 3 accessories. We go over why I think Apple is running this promotion. The discussion concludes with a few of my thoughts on Phil Schiller's comment that early MacBook Pro online sales are at a record. There are a few moving pieces to consider about the comment.
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Fitbit's Awful Earnings, Early Warning Sign for Apple Watch Sales?, Thursday Q&A
Today's Above Avalon stories:
- Fitbit's Awful Earnings
- Early Warning Sign for Apple Watch Sales?
- Thursday Q&A
We begin today's email with a closer look at Fitbit's 3Q16 earnings report and conference call. Results were not good. After going over my thoughts and observations about Fitbit and it's bad quarter, we shift to the two ways to interpret Fitbit's results. Does a weak Fitbit serve as a warning sign for Apple Watch? We end the email with the latest installment of member Q&A, and I answer the following questions from Above Avalon members:
- Could Apple buy Sling TV?
- Is Apple announcing more than they can deliver on?
- Why didn't Apple announce new Mac desktops last week?
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Jony Ive on the New MacBook Pro, Jony's Absence at the Mac Keynote, Thoughts on Mac Criticism
Today's Above Avalon stories:
- Jony Ive on the New MacBook Pro
- Jony's Absence at the Mac Keynote
- Thoughts on Mac Criticism
We begin today's email by discussing Jony Ive's interview with CNET regarding the new MacBook Pro. We go over Apple's goal with the Touch Bar, the ingredients that came together to create the Touch Bar, and the prospects of an iPad/Mac hybrid. The email then turns to Jony's absence at last week's keynote, which is becoming a trend. Is there anything to read into regarding his keynote absences? We conclude with my thoughts on the significant amount of MacBook Pro criticism. Upon closer examination, I don't think the criticism is just about the new MacBook Pro. It's much more.
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