Wednesday, July 20, 2011

Who Else Gains From Apple's Blowout Quarter? (ARMH; IMG.L; AAPL)

FT Alphaville has some answers:
An Apple a day…
… puts a rocket under your share price.

To recap, Apple’s third quarter results (published late on Tuesday) smashed expectation with both iPhone’s and iPad’s sales growing at an exceptional rate.
Apple sold 20.2m iPhone units during the quarter (expectations ranged from 17-19m) and 9.25m iPad units (expectations range from 7.5-8.0m).
And that’s very good news for ARM, says Morgan Stanley.
Intel vs ARM race – ARM remains ahead, with Apple commenting that iPad2 demand is strong and cannibalizes Macs but even more Windows PC. In particular, Apple mentioned the education market where, where iPad demand outstripped Macs for the first time. Stronger than expected demand for the iPad2 might also imply that non-Apple tablets are struggling to find buyers.
Product transition – Apple highlighted to a product transition in iPhones in the September quarter potentially addressing the prepaid market. If Apple was to launch an iPhone with an A5 (same as the iPad2 but with a technology shrink), that would be a slight positive to ARM ASPs.
It’s also a big positive for Imagination Technology, which designs graphic chips for Apple....MORE