Apple Inc. AAPL is set to announce its earnings after the market closes on Thursday, Nov. 2. The focus will be on the revealed data about the demand for the recently launched iPhone 15.
During an interview with Yahoo Finance, CEO and Principal Analyst of Creative Strategies Ben Bajarin stated that it is premature to evaluate the demand. However, he does note “a couple of challenges,” including supply constraints, suggesting the presence of “some elongated demand.”
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Bajarin mentions significant lead times in the research around wait times, indicating sustained demand. He also sheds light on the smartphone recovery and China’s emerging market recovery. Bajarin anticipates a strong upgrade cycle for premium devices, which could affect average selling prices (ASPs) and gross margins.
However, there are concerns about consumer confidence affecting Apple’s guidance for the December quarter. Bajarin notes that supply constraints, especially with TSMC’s 3-nanometer process for high-end iPhones, present a challenge. The number of devices Apple has produced remains unknown.
The trend over the last couple of years indicates that the upgrade base or new buyer base is skewing toward the higher end. Observations of ASPs and gross margins will provide insights into this trend.
Photo via Shutterstock
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