Many analysts have been drawing conclusions from Jabil Circuit, Inc. (NYSE:JBL)’s latest earnings results this week, and those at Jefferies are no different. Peter Misek, Jason North and Billy Kim say they don’t necessarily see the supplier’s results as a major negative for Apple Inc. (NASDAQ:AAPL). They also say it looks like Jabil’s exposure to BlackBerry is just about finished.


Apple sells more iPhone 5S handsets

There has been a lot of speculation that Apple Inc. (NASDAQ:AAPL)’s numbers will be weak because Jabil’s numbers were weak. After all, Apple did make up about 19% of Jabil’s August revenues. However, the Jefferies team believes that the mix shift toward the iPhone 5S rather than the 5C is what’s responsible for Jabil’s weakness.

Their checks suggest that Jabil makes about half of the casings for the iPhone 5C. As a result, they think Jabil Circuit, Inc. (NYSE:JBL)’s results were hurt by cuts in iPhone 5C builds. There have been many surveys which suggested that the iPhone 5S is far more popular than the iPhone 5C, so they could be right.

Jabil says a shift in demand was responsible

The analysts said management at Jabil “cited a significant shift in demand with key customer.” Of course they, as most others do, believe that the key customer is Apple Inc. (NASDAQ:AAPL). And if there is a shift in demand from the iPhone 5S to the 5C, then this would make sense since Jabil appears to have such a significant exposure to iPhone 5C sales.

Jabil also said they were confident in their overall relationship with the customer in question and believe the business will rebound in two or three quarters.

Apple and China Mobile

Of course there was also mention of the rumored but yet-to-appear deal between Apple and China Mobile Ltd. (NYSE:CHL) (HKG:941). Some analysts have speculated that demand for the iPhone 5C would pick up later after the initial demand for the iPhone 5S. Jabil may be counting on this as well, particularly if the deal with China Mobile does finally materialize.

The checks done by Misek and his team suggest iPhone build plans for the March quarter were increased from between 40 million and 45 million to between 45 million and 48 million. They believe the increase is because of China Mobile, although no official deal has yet been announced.

Jabil cutting ties with BlackBerry

In addition to Apple Inc. (NASDAQ:AAPL), Misek also drew some conclusions about BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) after viewing Jabil’s results. He said it looks like the supplier’s disengagement with the struggling Canadian company is on track, although it will support BlackBerry at least through the first calendar quarter.