Wed, Dec 24, 2014 - Page 14 News List

Morgan Stanley increases Q4 iPhone sales forecast

RECORD HIGHS:If the brokerage’s revised estimate for October-to-December smartphone sales is accurate it will be the highest-ever number of units sold in one quarter

Staff writer, with CNA

Morgan Stanley has raised its forecast for Apple Inc’s iPhone sales in the fourth quarter based on apparently strong demand in China.

In a research note, the US-based brokerage said it had revised its estimate of iPhone sales to 67 million units from an earlier forecast of 62 million units.

If the estimate proves accurate, it would set a new high for iPhone sales in a single quarter and far surpass the 51 million units sold in the third quarter.

Fourth-quarter sales are expected to rise substantially following the introduction in September of Apple’s two new iPhone models with larger displays — the 4.7-inch iPhone 6 and 5.5-inch iPhone 6 Plus.

The revised forecast by Morgan Stanley was even higher than the Wall Street consensus of 63 million units.

Morgan Stanley analyst Katy Huberty said in the report that China is Apple’s second-biggest market behind the US, adding that growth in demand from China in the fourth quarter has been nearly three times higher than growth in the rest of the world.

Demand for iPhones has also been solid in other emerging markets, such as Brazil, but demand in Japan has appeared relatively slow because of a higher sales tax, while demand in France has been compromised by the nation’s restrictions on distributors’ sales campaigns, Huberty said.

Analysts said strong iPhone sales could continue to boost shipments of Taiwanese suppliers to Apple, and investors have paid close attention to major local suppliers, in particular Hon Hai Precision Industry Co (鴻海精密), which assembles iPhones and iPads, and smartphone camera lens maker Largan Precision Co (大立光).

They said these suppliers are expected to see significant sales growth in the fourth quarter.

Hon Hai, the world’s largest contract electronics maker, saw its consolidated sales last month rise 22.58 percent year-on-year to NT$514.79 billion (US$16.22 billion), a new monthly record high, largely due to increased orders from Apple.

Analysts said that with sales growth momentum expected to continue this month Hon Hai’s consolidated sales for the fourth quarter could hit about NT$1.5 trillion, which would be a new quarterly high.

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