With all the hype surrounding the Apple Watch, people tend to forget that the core business of Apple Inc. AAPL is still iPhones.
Chris Caso from Susquehanna Financial was on CNBC recently to discuss his outlook for iPhone sales this quarter and what worries him most about iPhone numbers.
Bridging The Gap
"We are 57 million for the quarter," Caso said. "We raised a little bit as the quarter went on. I don't think that's a terrible surprise to people. People know iPhone has been successful now.
"When you go into the June quarter, now that's usually the lull quarter between iPhone launches, and that will be down. But that's the quarter where you get the Apple Watch. So that, we think, [...] bridges the gap between iPhone maturing a little bit on iPhone 6 and then getting the watch in."
Worries
Caso was asked to share the one thing he is worried about related to iPhone numbers. He replied, "I would say mix."
He explained, "Mix within iPhones. So, mix between iPhone 6 and the 6 Plus, and also the memory configurations because Apple makes a significant amount of margin depending on whether you got a Plus.
"The larger phone is much more profitable for them, as well as the 64, 128 gigabyte skews."
The Larger The Better
On which way the mix that he describe is leaning toward, Caso said, "More 6 Plus and more of the higher memory skews, and one of the things Apple did was they dropped the 32 gig skew. So, basically for another $100 you can go from 16 gig to 64 gig, and that's been very profitable for them," Caso concluded.
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