Gene Munster: Apple’s doing better than it looks; China concerns were overblown

Apple’s December guidance is better than it looks when you set aside consensus, and focus on the business, which is growing about 7% in December compared to 1% in September, Deepwater’s Gene Munster writes Friday. The product flywheel is intact, as evidence by the installed base of active devices setting an new all-time high and continuing to grow “nicely.” Concerns about China were largely overblown, with sales up 4% in constant currency and iPhone likely gaining share. And, Apple is working on generative AI and has the pole position among Big Tech to lead in personalized AI.
Gene Munster for Deepwater Asset Management:
‎

Shares of AAPL were down 1% just before CFO Luca Maestri give guidance that December revenue to be 5% below the Street. Following that comment, shares of AAPL were trading down 4%. Maestri added some context that there are 13 weeks in this December quarter compared to last year’s 14 weeks, a detail most analyst likely had factored into their models. Luca added that if this December quarter had 14 weeks, revenue would likely be 7% y/y, compared to up 1% in the just reported September quarter.
Guessing how many analysts correctly factored in 13 weeks into their models is a fools errand. The bottom line is each week the business is expected to grow 7% y/y in December, and that’s a measurable step up from the 1% growth in September.
Additionally, the calendar will normalize in March and reveal a business that will likely continue to grow at around 5%, a level that I believe investors will be satisfied with.

‎
MacDailyNews Take: Yup.
Apple’s December quarter this year is a week shorter than last year… Similar revenue in significantly less time means revenue growth… Last December quarter, Apple generated $117.2 billion in revenue in 14 weeks. That’s $8.371 billion per week. This December quarter, Apple expects to generate similar revenue in the usual 13 weeks. That’s $9.015 billion or $644 million more per week on average year over year. Growth. — MacDailyNews, November 3, 2023
‎
Please help support MacDailyNews. Click or tap here to support our independent tech blog. Thank you!
Support MacDailyNews at no extra cost to you by using this link to shop at Amazon.

The post Gene Munster: Apple’s doing better than it looks; China concerns were overblown appeared first on MacDailyNews.