Analyst: Apple’s Gross Margin Could Benefit from a New iPhone

Could a new iPhone be the answer to Apple’s ills? In a note sent to investors yesterday, Katy Huberty, an analyst with Morgan Stanley, made the case that Apple’s gross margin could see vast improvement from the release of the next iPhone, which is said to be the iPhone 5S.

Huberty examined Apple’s 10-Q filing with the U.S. Securities and Exchange Commission, and determined that Apple’s problems aren’t indicative of a problem with how the company operates.

In other words, Apple could easily rebound to its prior gross margin numbers with the release of a new iPhone.

In her note, Hubert wrote:

“The 10-Q discloses $904 million of commitments for equipment purchases compare to $4.5 billion just two quarters ago when Apple invested in new in-cell touch displays for the iPhone 5. The decrease is likely due to iPhone 5S not requiring significant hardware changes, therefore iPhone GM could be much higher in [second half of calendar year 2013].”

If Apple’s projections turn out to be correct, its gross margin will be between 37.5 and 38.5 percent during the second quarter, but Hubert paints a conservative picture in which Apple sees a 38 percent gross margin by September, which obviously is in the third quarter.

Will a new iPhone–whichever model it may be–sweeten Apple’s financial situation?  Only time will tell.

[via: ZDNet]