In conjunction with its “uncarrier” strategy with lower monthly service plan fees, T-Mobile
USA announced earlier this week that it will start carrying iPhone5
for the first time, starting from April 12. The company revealed that
Apple Inc. (NASDAQ:AAPL)’s iPhone 5 will just cost $99 up-front, including $50 per month for unlimited talk, text and internet with 500 MB data.
Analysts at Sterne Agee view this as
positive as it allows Apple Inc. (NASDAQ:AAPL) to gain market share in
the U.S. with an additional 42 million subscribers. The research firm
also believe this should help Apple Inc. (NASDAQ:AAPL)’s June quarter
outlook which most expect to be very conservative due to weak build
plan data ahead of new iPhone refreshes. Analysts at the firm continue
to see Apple Inc. (NASDAQ:AAPL) as a 2H story with several catalysts.
The research firm view the addition of
T-Mobile USA as a customer as positive as this is one of a few remaining
large carriers in the world that doesn’t carry iPhone. T-Mobile has 33
million subscribers and with its pending acquisition of MetroPCS will have a total of 42 million subscribers. This compares to 116 million for Verizon
Wireless, 107 million for AT&T Inc. (NYSE:T), and 55 million for
Sprint Nextel Corporation (NYSE:S). While T-Mobile USA has lost
customers, its core customer base remains loyal to its lower-cost and
unlimited data plans. Sterne Agee believe this will help Apple Inc.
(NASDAQ:AAPL) capture incremental customers and strengthen its position
against Google Inc (NASDAQ:GOOG) Android, which got its start on T-Mobile USA.
Most investors Sterne Agee have talked
to in recent weeks believe that the company’s June quarter guidance will
likely be very conservative, meaning a bit below consensus estimates.
This makes fundamental sense as research firm’s supplier checks indicate
that iPhone build plans have been cut due to weaker than expected
demand and what appears to be an inventory draw-down ahead of iPhone
refreshes in the 2H; however, analysts believe the addition of T-Mobile
USA as a carrier could somewhat offset. At this point, analysts are
comfortable with their iPhone forecast looking for 32.5 million units
for the March quarter and 30 million for the June quarter (vs. consensus
at 35-36 million and 30 million, respectively).
Sterne Agee continue to believe that
potential catalyst for the 2H are new carrier wins, as well as product
refreshes. Two large carriers that have yet to carry iPhone include China
Mobile and NTT Docomo. China Mobile is the world’s largest wireless
carrier with 703 million subscribers while NTT Docomo has 61 million
subscribers, which is more than half of Japan’s
cellular market. From firm’s supplier checks, analysts anticipate
refreshes including iPhone 5S, a lower-cost iPhone, and new iPads.
The firm continue to believe that Apple
Inc. (NASDAQ:AAPL) is positioned to outperform in this tough
macroeconomic environment with its defend-able strategic and structural
advantages and its vertical integration.
Tags
Technology
