Katie MarsalApple Inc., which reports results for its fiscal first quarter of 2007 after the close of the market on Wednesday, is likely to meet or slightly beat consensus estimates with help from robust sales of Macs and a rebound in iPod shipments, according to American Technology Research.
Wu, noting that consensus estimates have moved up considerably over the past month to catch up to his once-above-consensus view, is modeling the company to report earnings of $0.79 per share on revenue of $6.4 billion.
His breakdown calls for continued strength in the Mac business to account for 38 percent of Apple's first quarter revenue, with overall shipments rising 11 percent sequentially to 1.8 million units.
On the iPod side — which he believes will account for another 40 percent of total revenue — the analyst expects to see "a continued rebound" of 77 percent sequential growth to 15.5 million units, based on strength in iPod shuffle and special edition red iPod nanos. Â
Looking ahead to Apple's second fiscal quarter ending March, Wu said consensus out-quarter revenue estimates "appear reasonable" for the first time in over a year. Still, he sees the company guiding conservatively, but in-line, to $5.1-5.3 billion in revenue. His own model currently stands at $5.2 billion and $0.63 earnings-per share, versus consensus estimates of $5.2 billion and $0.60.
"We are forecasting a large sequential decline in iPods to 9.3 million units, but believe this will be offset by Apple TV shipping in February," Wu told clients. "As we have mentioned before, we believe Apple TV with its attractive price point of $299 could be a surprise hit."
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"We are forecasting a large sequential decline in iPods to 9.3 million units, but believe this will be offset by Apple TV shipping in February," Wu told clients.*"As we have mentioned before, we believe Apple TV with its attractive price point of $299 could be a surprise hit."
Hmm. I'm very skeptical about Apple Tv being a surprise hit... $299 for the device plus $179 for the Apple 802.11n router is $478, a hefty price to pay for it's limited functionality of getting "near dvd quality" iTunes media without surround sound to the living room... Especially when a $19 iPod AV cable will essentially do the same trick, albeit a less elegant method and without on screen menus, but still, the difference between $478 and $19 is significant when you consider that both methods will accomplish the same end result.
Split Split Split
Shaw Wu!
Gehsundheit.
Split Split Split
Yep, Yep, Yep!
I still say Apple will come in with 2MM mac units, although I think the iPod average selling point has dropped and we will end up with earnings per share of about $0.81.
The March quarter will be a little slower, but if mac unit sales hit the 2MM/quarter critical mass, it should be a good ride for the next 12 months!