Potential upside in Apple's recently concluded June quarter could be driven by greater-than-expected iPhone shipments, with one analyst predicting that the company beat projections and shipped at least 29 million iPhones.
Apple's current account base of 500 million users is growing and spending at a tremendous rate, suggesting to one analyst that new services such as mobile payments or streaming radio could be key to the company's future growth.
If Apple were to offer a new unlocked iPhone priced at $399 without a service contract subsidy, the company would be able to grow its install base without deteriorating its gross margins, one analyst has projected.
While Apple posted better-than-expected quarterly results and increased its quarterly dividend this week, market watchers are still concerned a lull in new product introductions is likely to continue until this fall.
Morgan Stanley analyst Katy Huberty recently met with Apple Chief Financial Officer Peter Oppenheimer, and came away with the impression that Apple will likely increase cash return to shareholders, and potentially release a lower priced iPhone to maintain growth.
Apple's lower gross margins — and, subsequently, its lower stock price — could be largely attributable to cyclical drivers such as capital expenditures and component pricing, paving the way for a significant improvement with the launch of a so-called "iPhone 5S," a new analysis argues.
Though Apple expects its margins to shrink in the holiday quarter as the company goes through an unprecedentedly large product transition, Wall Street watchers remain confident in recommending investors buy AAPL stock.
Though the starting price of the iPad mini is higher than many had expected, Wall Street analysts believe the storage capacity and build quality offered by Apple will be more than enough to court consumers and make the product a success.
Increases in capital expenditures historically have a direct correlation to revenue at Apple, and a recent spike in spending suggests the company is set to deliver a record quarter of at least $56.4 billion in revenue this holiday season.
Though Apple fell short of market expectations with its third-quarter earnings on Tuesday, analysts on Wall Street still have great expectations for the company during the 2012 holiday shopping season.
Apple's 2012 Worldwide Developers Conference Keynote was met positively by analyst on Wall Street, who expect this year's iOS 6 upgrade to further establish the iPhone as the leading device in the smartphone market.