Thursday, September 4, 2008

iPhone Ubiquity

The iPhone is the coolest gizmo I have ever owned.  Nothing, compares.  Not my baseball cards, my Camera, stereo high def-TV, convertible, toaster oven, None of it.  Not even my Mac Plus (which back in the day was pretty badass)

The iPhone is simply put the single most compelling computing device to hit the market since the first PCs 30 years ago. 

It is clear that the iPhone as a handset and platform are so dramatically different and better than current market offerings that sales growth will continue to be freakish.

Gene Munster Put Apple on its "Alpha"  (Piper Jaffray)List this week indicating that there is significant short term upside in the stock of Apple (AAPL).  While mentioning that he expects Apple to sell 45 Million handsets next year.  45 MILLION.  I have not seen another analyst reporting a number that big.

Reports of manufacturing runs of 800,000 a WEEK being reported by several sources.
Munster mentioned Apples Back to School promotion which gives buyers a $299 incentive to purchase a Mac  (Free iPod woo hoo).

So I did some analysis of my own.  and projected out Sales thru 2014.  It is a Projection so by definition it will be wrong. 


I project Apple with 30% of the handset market in 2014.  (I made it up)  Nokia has 40% of the market currently so it is not unreasonable to assume that one company could have a share of that size.  There will be competition from someone we don't know who yet but someone will come up with a compelling competitor to the iPhone platform.

As a thought experiment Apples earnings per share could be 12 bucks a share from iPhone sales ALONE in 2014.  Oh and BTW 23 Billion in additional deferred earnings.  


Let me know.  I can send you the Excel...

The writer has been long AAPL for a long time.  The writer is not giving advice (call your mother) am not telling you to buy this stock, and think that people that don't do their own research are lazy and doomed to failure 


Anonymous said...

Eh, I honestly don't think Apple wants to dominate the phone market. Nokia only has a slice of the market that size because of all the cheap (not-smart) handsets out there. I seriously doubt Apple will attempt to enter that end of the market. I think Apple is more interested in pushing its mobile platform, OS X Touch. Adding cell phone capabilities to that platform was a natural extension.

Personally I think it's wrong to focus so much on the iPhone and ignore the iPod touch, which is probably selling just as many units if not more. I'm going to guess the next iPod touch gets, a microphone, speaker, and GPS, and possibly some kind of cellular radio for data plans.

Anonymous said...

Sounds like a car with no steering wheel to me. iPhone is now the bread, the butter, and the main course. iPod was a necessary first step.

Unknown said...

I too am of the mind that Apple does not want to dominate the phone market.

I think it wants to kill it. The iPhone is a Trojan Horse - an internet device disguised as a phone.

"Telephones" are so 20th Century. You need an audio/video/text communication tool.

When the at&t deal ends, expect Apple to go into VOIP in a HUGE way.