Analysts seem to have forgotten Apple, which owns a whopping 20% of the mobile phone market and more than 60% of its profits. Buy the stock.
I bought some shares this morning.
I'm expecting a blow out quarter from on Thursday Jan, 29th. Apple's YoY revenue could jump a record 11% to $138Bn, which is amazing for the number one brand in the world and a $450Bn revenue behemoth. It has navigated tariffs and geopolitical issues with China like a champion with the iPhone getting a massive 21.8% share of the Chinese market. The previous quarter revenue high was $124Bn in FY2025
Earnings shouldn't be a slouch either with GAAP earnings per share of $2.67, an increase of 11.5%
“As always, Q1 results are key to monitoring the performance of the iPhone (56% of revenues in Q1 25)," said HSBC analysts, led by Nicolas Cote-Colisson, in an investor note."Apple's success is largely driven by the success of the iPhone 17 series, in particular, the iPhone 17 Pro and Pro Max, as well as the continued success of the iPhone 16 in key emerging markets."
Besides the stellar performance and beating expectations, we tend to forget that the premium, high end product, iPhone has a 20% share of the global smartphone market in 2025 with a 20% share according to Counterpoint research. Can you imagine BMW or Mercedes having 20% of the auto market?. This is a fairly rare phenomenon when the premium brand has 20% of any market. And its not just because of the high ASP- it leads in Q4 smartphone shipments, with its highest-ever share of 25%, followed by Samsung (SSNLF) at 17%.
AI datacenters have been monopolizing memory supply, leaving cell phones and PC makers to pay higher prices, with estimates suggesting that data centers would likely take 70% leading to another surge of 40% to 50% in prices in Q1 and a further 20% increase in Q2.
However, according to IDC, Apple should be safe in the short term, though. "In the high end of the market, Apple and Samsung face pressure but are structurally hedged. Its cash reserves and long-term supply agreements allow it to secure memory supply 12-24 months in advance. On the other hand, new flagship models in 2026 will likely have no RAM upgrades, sticking to 12 GB for Pro models rather than increasing to 16 GB."
The stock went up just over 11% in the past year. Apple Intelligence is finally showing signs of life as the Gemini partnership closes some of the AI gap that iPhone, (Siri) and Apple have with competitors. Apple will remain a core holding and I’m accumulating on declines this year.
Apple could monetize default search engine placement as a key source of revenue in the future. In the same way that Apple historically monetized default search placement (by getting paid big dollars to route high-intent user traffic to a search partner), I believe Apple could monetize AI queries by getting Anthropic, OpenAI and Gemini into a bidding war. The massive installed base of 2B+ users, would be a big draw for AI foundational models. That will be the next leg of the growth story, once the likes of Gemini and ChatGPT figure out how to monetize their LLM chatbots.
The recent weakness in Apple's (AAPL) shares — down seven weeks in a row — is a “buying opportunity” ahead of the iPhone creator's quarterly earnings, Goldman Sachs said.
Goldman Sachs analyst Michael Ng said he expects Apple to earn $2.66 per share for the coming quarter, with iPhone revenue estimated to grow 13% year-over-year and shipments up 5% over the same time frame, including 26% growth in China. Ng has a Buy rating and a $320 price target on Apple. “iPhone demand in the next 2 years is likely to benefit from the iPhone Fold (Fall 2026, 4.5/25.4M units in F2026/F2027), the shift to a biannual iPhone launch cycle with the iPhone 18 base and iPhone Air 2 delayed from Fall 2026 to Spring 2027, and new software upgrades with iOS and Siri 2.0,” Ng wrote in a note to clients. "Services revenue growth +14% should be supported by momentum in other categories (e.g., TAC, iCloud+, AppleCare+) with further tailwinds in F2026 from new ad formats in the App Store.”
Ng added the price and mix growth of Apple's products and the continued shift towards services should help boost gross margins, even if memory costs rise.
I plan to keep accumulating.
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