Despite a warning by Apple CEO Tim Cook about lower revenues for Q1 and disappointing sales of new iPhones and Apple Watches, one top Apple analyst says there are encouraging signs ahead for the company, according to a report by CNBC.
Ming-Chi Kuo, an analyst with TF International Securities, said there are “limited downside risks for Apple and iPhone suppliers’ share prices.” Kuo also said shipments in the second quarter will beat market predictions.
Kuo, who reportedly has sources from Apple’s suppliers, is a respected analyst who was one of the first to predict decreasing smartphone sales.
The past month has been hard for the company, especially after Cook’s revenue warning. However, Apple shares have bounced back enough to catch up to the warning’s specific losses. On Monday, the stock was down 1.7 percent, and it’s still down about 30 percent from October’s all-time high.
Kuo said Apple could definitely still experience a year-over-year decline in shipments through the next couple of quarters, but the overall harshness of the dips should get easier.
Apple will report the company’s first-quarter results on Tuesday (Jan. 29), and Kuo is predicting Q1 iPhone shipments of between 36 and 38 million units. Apple said it would no longer report iPhone sales, though, so it will be hard to get an exact number.
“If Apple continues the trade-in programs and the U.S.-China trade war does not worsen further, we expect (2019) iPhone shipments will be generally flat YoY, thanks to replacement demand, trade-in programs and market share gain in European markets,” Kuo said.
Other parts of Apple’s business, however, are flourishing. The company reported that worldwide customers of the App Store broke new spending records over the holidays, marking the end of a record-breaking year for that sector of the company.
Between Christmas Eve and New Year’s Eve, spending hit more than $1.22 billion. On New Year’s Day, customers spent $322 million, a new single-day record.
“The App Store had a record-breaking holiday week and New Year’s Day,” said Phil Schiller, Apple’s senior vice president of Worldwide Marketing. “Thanks to the inspiring work of our talented developers and the support of our incredible customers around the world, the App Store finished off an outstanding 2018 and kicked off 2019 with a bang.”