Investing
Apple Event: Refining Products and Exercising Pricing Power
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By Gene Munster and Will Thompson of Loup Ventures
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The Mix Reveals the ASP Story
Our biggest near-term takeaway from the event was that ASPs are moving higher. We are raising our estimates, expecting a 7% ASP increase next year from $745 to $791. Given the mix, it’s hard to see ASPs next year below $800 (vs. $745 this year). The table below compares our product mix assumptions.
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To illustrate our conservatism, our model anticipates 38% of new unit sales come from the Xr line, the lowest-priced of the new phones. This compares to our assumptions of 12% of units from Xs Max and 9% from Xs. From a high level, our modeling methodology is consistent with past years in that we’re expecting the newest SKUs (Xs Max, Xs, and Xr) to account for 59% of new iPhone sales, compared to last year when we estimated the newest SKUs (8 and X) accounted for 54% of new sales.
Changes to the Model
Link to updated model here.
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Disclaimer: We actively write about the themes in which we invest or may invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we may write about companies that are in our portfolio. As managers of the portfolio, we may earn carried interest, management fees or other compensation from such portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making any investment decisions and provided solely for informational purposes. We hold no obligation to update any of our projections and the content on this site should not be relied upon. We express no warranties about any estimates or opinions we make.
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