Apple’s iPhone 13 news: What the analysts are saying
Updated 9/15: Apple introduced the iPhone 13 collection, iPad mini, a new iPad and Apple Watch Series 7 today, along with its all new A15 processor. You can read more about its news here, a little context here, and what follows are the first responses I’ve seen from analysts.
Update: Morgan Stanley
Analyst Katy Huberty said:
“When combined with iPhone replacement cycles that remain elongated, 5% 5G adoption within the iPhone installed base, fully reopened retail stores, and elevated iPhone backlog entering FY22, we remain bullish on the prospects for iPhone growth in FY22, with the potential for upside vs. our current iPhone ASP forecast (-1% Y/Y).
“We also expect international retailer/carrier reports on iPhone 13 pre-orders to begin trickling in over the weekend. Should early reports indicate elevated iPhone demand vs. low buy-side expectations, we’d expect Apple shares to outperform in the near-term,” she said, “Especially given the iPhone’s stronger inventory/supply chain positioning vs. smartphone peers.”
GlobalData
Stressing 5G, Anisha Bhatia, Senior Technology Analyst at GlobalData, offers her view: “Apple’s iPhones are its biggest revenue generators, accounting for 40% to 50% of the company’s overall returns, and Apple has a substantial installed base waiting to upgrade. With massive promotions offering the phones for $0 to $100, the iPhone 13 will continue the 5G supercycle that started with the iPhone 12.”
Uswitch
Ru Bhikha, at Uswitch.com, said: “Folding handsets are pushing the boundaries of what’s possible, but it is getting harder for manufacturers to make their most popular devices stand out, which made this Apple launch event intriguing to watch. Apple will be hoping that its hardware allows it to stand out, with the release of the A15 Bionic chip included in the iPhone 13 delivering better performance and allowing 15.8 trillion operations per second. The new chip also improves battery life, which is at the top of people’s wishlist for the new handset.”
CCS Insight
Ben Wood, Chief Analyst, CCS Insight had so much to say:
“The company is offering enough new features to fuel consumer demand, with the vast majority of purchases being upgrades by existing Apple customers.
“Apple has a proven and profitable approach that it appears capable of sustaining for a long time. Only a major industry disruption, such as a dramatic shift to flexible devices, which is far from certain at present, would force it to radically deviate from this strategy.”
“Much to the dismay of its rivals, there is little reason to indicate Apple is not on course to continue its incredible momentum into 2022.”
He also points out:
“Although new camera features, better battery life and other tech specs will grab the headlines, the biggest story is arguably the impressive trade-in prices being offered by Apple and its partners. US buyers trading-in the previous iPhone can get up to $1,000 toward a new model and we expect similar deals in other markets around the world. It’s a major competitive advantage for Apple, and is likely to boost the residual value of iPhones, which are already the highest in the market thanks to Apple’s ruthless product consistency and multiyear software updates.”
“Apple has long been prepared to lag rivals when it comes to the adoption of the very latest technology, but history has shown that Apple customers are happy to accept this. While other phone-makers forge ahead in areas such as optical zoom and ever-higher screen refresh rates, Apple takes a more incremental approach, making updates at its own pace when it feels they add the necessary value or address a competitive threat.
“Camera performance has become the main battleground in premium smartphones and it’s no surprise Apple has upped its game, adding 3x optical zoom, macro photography and video features such as Cinematic Mode to the top-end iPhones. Although many of these technologies exist on rival smartphones, Apple has done more than enough to maintain the perception that the iPhone offers one of the best camera experiences available.
“It looks like Apple has made good progress on battery life, something that is hugely important to consumers spending more and more time glued to their phones. For people upgrading from much older iPhones, the improvement will be dramatic.
On iPad mini
“It is interesting to see the return of the iPad mini, which has not been updated since March 2019. The move has probably been triggered by the renaissance of tablets as people blew the dust off old devices in the rush to get connected at home during the pandemic.”
“The new iPad mini is a major upgrade and arguably more akin to Apple’s iPad Pro category given its design, support for the A15 Bionic chip and a USB-C connector. However, it will undoubtedly provoke debate about why many other models have not abandoned the proprietary Lightning adaptor in favour of the more ubiquitous USB-C to be found on some iPads and Macs.”
“The iPad mini represents a significant opportunity for the iPad brand to extend deeper into the numerous industry sectors that Apple is already supporting, such as aviation, healthcare and retail.”
CCS Insight, Leo Gebbie
Leo Gebbie, Principal Analyst, CCS Insight says:
“At first glance the latest Apple Watch is another iterative update, but the larger screen allowing bigger virtual buttons and up to 50% more text on screen should certainly improve usability.”
He also says:
“Rolling out Fitness+ to a further 15 markets underlines Apple’s desire to grab a huge slice of the remote fitness market. New guided meditation classes and workouts will be welcomed, but the stand-out feature is undoubtedly Group Workouts, which adds an interesting competitive element to exercising at home, and a further lock-in to Apple’s ecosystem.”
Piper Sandler
Harsh Kumar, Piper Sandler: “We believe the announced iPhone trade-in programs (up to $700 for the iPhone 13 and up to $1,000 for the iPhone 13 Pro) will continue the 5G iPhone upgrade momentum.”
Wedbush
Daniel Ives at Wedbush calls the storage increase to 1TB “a potential game changer.”
He also said: “Apple is in the midst of its strongest overall product cycle in roughly a decade” and the iPhone 13 “continues the supercycle for Cupertino.”
Constellation Research
R Ray Wang, Constellation Research (link) explained: “Apple’s new phones make them ready for the metaverse economy. You see it with the faster chips. You see it with the better displays. You see it with the better battery life. And more importantly, you can see the AI and the AI actually putting themselves into action, making things a lot more easier for users. And so the services growth is the number I’m looking at.
“Most people are looking at the shipments of units. And I think it’s more important to think about how Apple is now a media company in terms of fitness, Apple TV, health, education. And that’s why I say these advancements are getting them to be metaverse ready.”
Update: Piper Sandler
Piper Sandler analyst Harsh Kumar termed Apple’s news as not being “revolutionary”, given “most of the new hardware items were redesigns and performance improvements from previous generations.” Despite this tepid response, he thinks trade-in programs and the move to 5G will maintain momentum for the company and holds a $175 target price.
Update: Evercore
Analyst Amit Daryanani, says: “The incremental features will make this a compelling product for the 900M+ iPhone users that didn’t purchase the iPhone 12 – ensuring the iPhone cycle sustains into CY22.”
Update: Loup Ventures
Gene Munster, has an interesting take, writing: “Apple’s annual flagship event was another iteration of providing products with increasing value to consumers at largely consistent prices. This is what we refer to as a virtuous cycle of mutual benefit. A product provides increasing value to the consumer at the same or lower price point, while more value accrues to Apple as it continues to grow its monetizable device base. Companies that participate in this virtuous cycle are most likely to continue to gain market share and expand market cap.”
Update: IDC
Analyst Wang Xi said Apple: “Will have an even clearer advantage in the premium smartphone market with the iPhone 13’s approach to pricing, displays and storage”. (Link).
Update: Counterpoint Research
“As 5G phones become the norm, Apple needs aggressive pricing to occupy the 5G phone market,” said analyst, Ivan Lam. “A high refresh rate display can be found in many flagship Android phones in China, Apple is catching up on that.”
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