Apple Watch May Face Delivery Delays; JP Morgan Sees High Demand Late In 2015

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Many have said that Apple Inc. AAPL might be facing delivery delays for its Apple Watch. While this has not been confirmed by the company, advocates for this theory are piling.

Among those who believe that the Apple Watch may face delivery delays is JP Morgan's Rod Hall, who said that the "Apple Watch Low Yield Rate May Lead to Long Delivery Delays."

"'The yield rate of the Apple Watch stands at less than 60% and may even be as low as 40%,' said a Foxconn official, adding that ‘its screen and components require a high level of sophistication.' ‘The yield rate has been improving at a satisfactory speed, and we believe shipments of the Apple Watch can top 3m units from March through May,' said a Quanta official," Hall explained.

Related Link: Expert: Why Apple Watch Will Be Apple's Most Upgradeable Product

As with most new Apple devices, JP Morgan expects "the Watch to be in short supply initially with production ramping rapidly after that. We [the analysts] believe demand is likely to be the gating factor for sales though we continue to expect a rapid ramp in unit demand as H2 of this year progresses and the device achieves critical mass."

The firm also sees Apple as a likely early adopter of fan-out packaging, which they expect to be driven by adoption for mobile products.

Shares of Apple were recently up 1.5 percent at $126.81.

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Posted In: Analyst ColorAnalyst RatingsTechApple WatchJP MorganRod Hall
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