A host of smartphone manufacturers, including Apple, launched their devices during the month of September. However, it is Apple Inc. (NASDAQ:AAPL), which is set to have the best of Holiday seasons, while other tech industry players sweat all the way through, amid poor macro conditions. Mizuho Research analysts believe that Apple will benefit from the growing demand for smartphones and tablets, as the PC counterparts continue to lose their grip on consumer spending.
Additionally, the adverse, macro-conditions, which are squeezing consumer spending, are promoting fierce competition between the tablet and smartphone industries, and the PC industry. The latter seems to be losing the battle, as consumers become technologically advanced, preferring the portable high-end gadgets over the desktop computers.
Apple Inc. (NASDAQ:AAPL) is expected to sell more than 50 million iPhones during the December quarter, with the newiPhone 5 representing approximately 70% of that number, with estimates ranging between 35 to 38 million units. Mizuho established that the initially feared in-cell display supply bottleneck is being handled very well by Apple, as exhibited by its supply chain, in a recent survey.
The iPhone maker is backed to launch at least 25 million smartphone sales for its September quarter, and is also attracting healthy demand from iPad buyers. The predecessor iPhones, the iPhone 4 and the iPhone 4S, are also reported to be maintaining strong demand from around the world, due to the discounted pricing for the two devices, and the launch of the new iPhone 5. iPhone 4 and 4S are expected to ship approximately 15 million units during the December quarter, bringing in a tally of around 50 to 53 million units of iPhone sales for the C4Q12.
It would be such a perfect season for Apple Inc. (NASDAQ:AAPL), but not so for the PC makers, whom Mizuho Securities analysts feel that the near-term forecasts should be revised downwards. The analysts have detracted the C1Q13 PC shipments estimate to decline by 7%, the same figure realized during C1Q12.
The Security analysts have also revised the perceived growth of the number of PCs sold during the September and December quarters to 6% from 8%, and 2% from 4%, respectively, each down 2 percentage points from previous estimates. This is mainly due to the unexpected appetite for the new iPhone 5, and the increasing demand for smart devices. Indeed, Mizuho Securities analysts mention that the PC industry will only begin its revival once touch enabled machines hit the market, coupled with improved macro conditions.
People can perform several tasks using their iPhones, or iPads, a majority of which, are traditionally meant to be done using PCs. With your new iPhone 5, you can view, edit, and create documents, spreadsheets, and presentations. Additionally, you can also use them for video calling, navigation, and above all, they are incredibly portable. This to me, seems like a daylight business robbery by the smartphone and tablet makers, the victim being the PC industry.
Nonetheless, Apple Inc. (NASDAQ:AAPL), which happens to feature in both industries, seems to be leveraging well between the two markets. A slight slowdown has been reported in regard to the demand for its Mac computers. However, this is nothing compared to the overwhelming demand for its iPhone devices, as mentioned earlier. Apple’s ecosystem gives it the muscle to endure through the torrid economic times, amid intensive price competition amongst its peers.
Apple, unlike other PC makers, has diversified its business, both horizontally and vertically; a majority of PC makers acquire software for their machines from other industry giants, like Microsoft Corporation (NASDAQ:MSFT), Oracle Corporation (NASDAQ:ORCL), and Intel Corporation (NASDAQ:INTC), among others. Apple, on the other hand, produces its own software, and its own PCs, not so for Microsoft, Hewlett-Packard Company (NYSE:HPQ), Dell Inc. (NASDAQ:DELL), and several others.
Analysts from Mizuho Securities have reduced their revenue and EPS for HP, and Dell by $2 billion, and $0.40 per share respectively, and slashed their price target for Dell by $4.00, to $10.00 per share. They have maintained their neutral view on the two stocks.
On the other hand, the analysts have upheld their buy rating for Apple Inc. (NASDAQ:AAPL), while maintaining a price target of $750, for the Silicon Valley company.
At the time of this writing, Apple Inc. (NASDAQ:AAPL) stock was trading at $670.31, up $3.21 per share, or 0.48% rise from the previous close. In the early stages of the day, Apple was trading at about $675 per share.
