Apple Event: iPhone 12 Expected With 5G Capabilities
October 13 2020 - 05:59AM
Dow Jones News
By Tim Higgins
Apple Inc. later Tuesday is expected to reveal its latest
iPhone, a device capable of connecting to a much faster 5G cellular
network, which investors are betting will spur strong demand.
The latest smartphone arrives five years after iPhone unit sales
peaked. Chief Executive Tim Cook has pushed the company to sell
more-expensive versions of the device and rely on software services
and wearable devices, such as smartwatches and headphones, to boost
revenue.
Unlike in past years, Apple is holding its iPhone event without
journalists, partners and employees in an auditorium, opting
instead because of Covid-19 for a virtual event slated to begin at
1 p.m. New York time, similar to one last month for the company's
latest smartwatches and other updates. The event can be viewed on
the company's website.
The iPhone 12 is hotly anticipated by investors who have driven
up the company's shares 69% in 2020, partly because of excitement
over the new phone. Those expectations and Apple's success in
driving up services revenue helped it become the first U.S. public
company to eclipse $2 trillion in market value earlier this
year.
Analysts surveyed by FactSet, on average, predict iPhone revenue
will rise 15% to $160 billion in the fiscal year that began Oct. 1.
That is about $6 billion shy of the record set in fiscal 2018, when
the $1,000 iPhone X helped bolster sales even as shipments failed
to reach a new high.
Katy Huberty, the veteran Apple analyst for Morgan Stanley, last
week predicted the company could ship as many as 240 million
iPhones this year, helped by customers who haven't upgraded in
several years and excitement for 5G. That would set a record,
beating the 231 million devices sold in fiscal 2015. Sales at that
level could send the company's shares up 37% from Monday's close to
a market value of almost $2.9 trillion, she said.
"We expect this fall's launch to be the most significant iPhone
event in years," she wrote in a note to investors.
Apple is expected to offer several versions, including with
three different-size screens ranging from 5.4 inches to 6.7
inches.
In recent years, Mr. Cook has been stretching the iPhone lineup
to appeal to a broad array of pocketbooks. The iPhone 11 Pro Max,
with the largest 6.5-inch screen, for example, started at $1,099,
while the high-end smaller Pro version with the 5.8-inch screen
started at $999. The iPhone 11 with a 6.1-inch screen and less
photography capabilities than higher-end models began at $699. A
second-generation iPhone SE with a 4.7-inch screen was unveiled
earlier this year and starts at $399.
Some analysts, however, are skeptical that customers will flock
to a 5G without a must-have application or service to help them see
the appeal of the new technology. U.S. cellular networks are still
being upgraded, and service may be disappointing in some spots for
early adopters.
It is also uncertain how the coronavirus will affect sales of
the new devices. The pandemic delayed production of the flagship
phone earlier this year, which led to Tuesday's unveiling being
delayed to October from its traditional September date.
Mr. Cook will appear publicly for the first time since a
Democratic-led House subcommittee last week issued a blistering
report that claimed Apple uses its control over software on its
devices in an anticompetitive manner.
Apple has said it "vehemently" disagreed with the report's
conclusions and that it doesn't have a dominant market share in any
area.
Write to Tim Higgins at Tim.Higgins@WSJ.com
(END) Dow Jones Newswires
October 13, 2020 05:44 ET (09:44 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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