Apple stock has been dragged down by multiple reports of weakness within the iPhone maker’s supply chain, and today there’s yet another warning in Jabil Circuit’s latest earnings report. However, there are signs that nearly every Christmas tree in the U.S. will have an Apple product under it as the company’s devices are performing well on Amazon.
Apple products trending on Google
In a report dated Dec. 17, Morgan Stanley analyst Katy Huberty noted that the iPhone holds the top position on Google Trends in the consumer electronics category. In fact, three of the top five products in that category on Google Trends were Apple products, while only one Apple product was among the top five consumer electronics products searches last year on Google.
Huberty reports that this year the iPad and Apple Watch climbed into the top five. The iPhone was again the top-ranked device, repeating its position last year. Searches for the Apple Watch have climbed throughout the year, rising from number eight last year up to number three. The iPad was in tenth place last year but this year landed in fourth place.
Also in Google Trends’ consumer electronics top ten list, Samsung’s Galaxy lineup took second, sixth and seventh place. Microsoft actually won a place in the top ten list this year as well with the Surface Pro 4 landing in tenth place.
Apple Watch and TVs the most-wanted gifts
Huberty also looked at data from IBM’s Watson Trend, which includes data from social media posts, blogs, forums and product reviews relating to purchase decisions. Each day, Watson compiles and analyzes these conversations and assigns Trend Scores. In the Technology category, the Apple Watch received the highest score, and Huberty believes this could be because retailers have been offering discounts of $100 on the smartwatch for the holiday shopping season.
Watson Trend also predicts that TVs are hot gifts this year as Samsung, Sony and LG – three big TV brands – took second, third and fourth places.
Apple and supplier Jabil Circuit
Also this week, Jabil Circuit released its November quarter earnings results, which may suggest problems for Apple in spite of the Google Search and Watson Trend data regarding conversations about the company’s devices. The earnings report comes on the heels of reduced guidance from another supplier, Dialog Semiconductors.
Stifel analyst Aaron Rakers noted in a report dated Dec. 16 that Jabil’s guidance suggests a 14% year over year growth rate for its Diversified Manufacturing Services business, which is important for Apple because it is the segment’s biggest customer. Rakers said this implies a sequential decline of 23% for the February quarter. Jabil management said seasonality is “a little bit steeper than normal,” said Rakers in his report.
For fiscal 2015, the iPhone maker accounted for 24% of Jabil’s total revenue, an increase from last year’s 18% and 2013’s 20%. This suggests that the company made up about 60% of the firm’s Diversified Manufacturing Service business’ revenue, which is up slightly from last year but down a bit from 2013. Rakers provided the following chart to demonstrate the correlation between iPhone and iPad shipments and Jabil’s Diversified Manufacturing Services revenue.
As of this writing, shares of Apple were down 1.39% at $107.47 per share.