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Apple supplier Jabil earnings report suggests steady demand for iPhone 7 Plus, great demand for 'iPhone 8'

A pair of analysts have chimed in on Apple supplier Jabil's positive quarterly earnings report through February, and sees signs that Apple's seasonal decrease in iPhone sales may not be as pronounced as expected.




Rod Hall from J.P. Morgan noted that Jabil's $4.4 billion in revenue beat consensus and the company's estimations by 2 percent. Phone orders are generally made the quarter before need, so an uptick in Jabil's earnings suggest that Apple has maintained or expanded its orders for the end of the first calendar quarter and the beginning of the second quarter starting in April.

Timothy Arcuri from Cowen and Company declares that Jabil's earnings report "suggests slightly stable to even improving iPhone supply numbers" mostly on the strength of the iPhone 7 Plus. Arcuri believes that projected earnings numbers for Jabil support a "solid" late 2017 iPhone launch of the "iPhone 7s" and "iPhone 8" and is expecting to see about 110 million units sold in total in the holiday quarter for all three new models combined.

Jabil is expecting an "unusually strong" fourth quarter outlook following the expected Apple fall product launch, and between $4.25 billion and $4.55 billion in the third quarter, falling in line with analysts' predictions. Apple makes up approximately 24 percent of Jabil's sales overall, and accounts for 60 percent of its Green Point division.

Jabil Circuit, Inc. is based out of St. Petersburg, Fla. with a large manufacturing contingent in China. It has been a supplier of aluminum case parts for the iPhone and iPad for some time.

Apple's rumored "iPhone 8" may be released in September alongside an "iPhone 7s" family, and is said to feature next-generation technology like an OLED "wraparound" screen with Touch ID home button and other sensors embedded behind the glass. Recent rumblings out of Apple's East Asian supply chain suggest the device will ditch aluminum for forged stainless steel as part of a "glass sandwich" design reminiscent of the iPhone 4 series.