When it comes to Apple, you can forget the iWatch and forget the Apple TV, and there’s no need to worry about the iPad. There is really only one thing that matters: the iPhone.
The iPhone accounts for 60% of Apple’s sales, but ~99% of what investors and analysts think about when it comes to Apple. That’s why they mostly shrugged last when Apple delivered horrible iPad sales numbers. The iPhone, which is what matters, was stronger than expected.
Analysts think Apple has an opportunity to deliver boffo iPhone sales this fall when it rolls out the iPhone 6. The new iPhone is expected to come with a much larger screen, which will drive people to upgrade their phones. And, as you can see in this chart, iPhone owners, at least in the U.S., are due for an upgrade.
Morgan Stanley made this chart that shows that more than half of the U.S. iPhone owners on Verizon are stuck with a 4 or 4S. Nearly half of AT&T owners are in the same predicament. When the iPhone 6 hits, Morgan Stanley, like many on Wall Street, expects a massive upgrade cycle from all these people with tiny, old iPhones.
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