Apple's Fiscal Q1 2015 Results Could Be 'Wickedly Successful'

If more apps equals more phones, Apple Inc. AAPL could be headed for a record-breaking quarter. Many analysts already felt that the Cupertino, California-based tech giant had sold a large number of iPhones. Apple reinforced that belief when it announced that customers spent nearly $500 million on apps and in-app purchases during the first week of January. Better still, Apple set the all-time record for single day App Store sales on New Year's Day 2015. "I think this is a wakeup call for all the analysts," Global Equities Research analyst Trip Chowdhry told Benzinga. "More developers equals more applications, [which] equals more devices being sold. This is the only reason why Apple will be wickedly successful and where the competition will be a total failure because the competition is clueless about the winning equation."

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Chowdhry said that Apple's announcement tells investors that its "winning recipe" is based on the aforementioned equation. "Almost every year, Apple's revenues have increased and the products continue to grow," Chowdhry added. "Each iteration of the iPhone has been better than the previous iteration. Same with iPad." He predicted that Apple would experience a similar level of success with the Apple Watch.

Confirmation Of Success

Sean Udall, CIO of Quantum Trading Strategies and author of The TechStrat Report, told Benzinga that the App Store announcement confirms his own expectations for Apple. He said that his previous estimate (in which he believed Apple would sell 63.7 million iPhones during the December quarter) might have been above analyst consensus. Now he thinks that Apple's continued success has forced analysts to raise their numbers. "The bigger phones people buy, they tend to buy more apps," Udall told Benzinga. "Anything over 62, 63 million [units] is just a draw-dropping quarter." Udall said that some investors wanted Apple to fire its CEO, Tim Cook, in 2014. He said they should now praise him -- especially if iPhone sales set a new record. "Maybe the number is going to be closer to 65, 67 million units," Udall speculated. "I am firm in this: you cannot say, just because app sales rose 50 percent, phone sales will be 50 percent higher. [But] with large screen phones, people buy more apps." Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.