J.P. Morgan: OLED iPhone 8 will arrive on time in Sept. in small quantity, ASP of $1100
J.P. Morgan Apple analyst Rod Hall is out today with his latest forecast for the company’s upcoming fiscal Q3 and beyond, and within includes predictions for the iPhone 8 launch this fall. Notably, the firm combats some recent reports that the flagship OLED model would be delayed, claiming that it expects the model to arrive at least in limited quantities in time for the usual September launch.
More specifically, J.P. Morgan is reducing its prediction for shipments of the upcoming flagship device, which it refers to as the “iPhone Pro”, due to what it expects will be “a slower production start for the flagship OLED phone.” It doesn’t however, think recent reports of delays will cause any material delay for the actual launch of the device apart from perhaps constrained supply as usual in the first month or two.
“…we do not believe that Apple’s production schedule is still changing materially with most current delay reports simply dated reverberations of decisions Apple made back in the spring. We expect a small amount of late September EMS output for the Pro model and then ramping production through October with target output levels achieved in late October/early November”
But just how many will be available at launch? To reflect a slower start for production of the OLED iPhone model, J.P. Morgan is adjusting its forecast for the device from 9m units for September to ~2m units for September. It notes, however, that it will also increase its Y18 unit forecasts “by about the same amount to reflect time-shifted demand.”
“Our total iPhone shipments estimate for FQ4 is now 42.2m, reduced from our prior 49.5m forecast. Our FY18 iPhone shipments estimate is now 270.2m, up from our previous estimate of 262.9m”
The report today from J.P. Morgan also adds to the many recent reports that the new flagship iPhones could debut with a higher average selling price. The firm is once again increasing its expectation for the average selling price by $100 to $1,100, noting that it believes “production costs are slightly higher than we had originally anticipated.” It also thinks the higher average selling price will be a “critical demand control variable for a new tier of iPhone” and that “Apple’s pricing strategy is likely to be aimed at spreading this replacement cycle over two years given totally new product categories like AR are likely still a few years out.”