The mix of iPhone 5s and iPhone 5c sales is the most important variable in the quarter, Huberty noted. She is assuming that the iPhone 5s, which has exceptionally strong margins, will account for 45% of all shipments, though she notes, "demand has been stronger than expected." For every 5% increase in 5s mix, Huberty notes it would add "$5 of ASP, 10bps of GM, and $0.16 of EPS."
For the quarter, she's expecting earnings of $14.30 a share on $55.6 billion in revenue, with gross margins coming in at 38.7%. Analysts surveyed by Thomson Reuters are looking for earnings of $13.80 a share on $55.4 billion in revenue.
Outside of the earnings number catalysts, Huberty is exceptionally bullish on Apple over the next few months. The upcoming iPad refresh, which is slated to happen on Oct. 22, "would give the product line a much needed boost after shipments fell Y/Y for the first time ever in the Jun Q," she wrote. Cheaper iPhones, such as the 5c, or a discount to the iPhones, would help earnings. It's important to note that while Apple doesn't discount its new products, some retailers, including Wal-Mart, Best Buy, and Target have been discounting the 5c.
Outside of hardware, Huberty notes that the new fingerprint sensor, TouchID, could herald new services to make the iOS ecosystem "even stickier and differentiated." The same could apply to iCloud Keychain and iBeacon, something akin to GPS for indoor locations. Apple acquired WiFi Slam, an indoor-GPS company , earlier this year for a reported $20 million.One more thing Huberty is bullish on: that little thing called the iWatch. --Written by Chris Ciaccia in New York >Contact by Email. Follow @Chris_Ciaccia
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