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Apparently missing the memo on iPhone in China, BofA analyst Wamsi Mohan found other reasons to be excited about iPhone sales. Those reasons would be 5G, AR, and VR. Seeking Alpha (via Apple Stocks) highlighted a note from Mr. Mohan.
While the world seemed surprised by the strength of tech sales during the first two-years of the pandemic, folks are ready to start buying harder. The piece has Mohan indicating that:
…replacement cycles for smartphones are “re-normalizing,” pointing out that a January 2022 survey found that 30% of respondents are likely to upgrade their phones every year, higher than the 23% in March 2020, but still below the 32% seen in December 2019.
Quoting his note:
Overall intent to upgrade to an iPhone has been trending positively with corresponding drop in intent to purchase competitor phones… Our survey also suggests that outside of 5G, the launch of AR glasses can further drive a replacement cycle for iPhone. This is supported by our survey wherein a large market like China, 20% of respondents showed willingness to upgrade to some model of iPhone supporting 5G in order to have a better AR/VR experience.
Also, a quarter of the people he and his were talking to were still rockin’ an iPhone 8 or older. That makes them ripe for an upgrade. Apple services are also seen helping to drive iPhone intent to buy.
Speaking of which, Mr. Mohan has a “Buy” rating on Apple shares. His price target on the shares is $215.
