Apple(US:AAPL) First Shanghai Securities·2024-11-27 13:31Investment Rating - The report maintains a "Hold" rating for the company with a target price of $255.00, indicating a potential upside of 9.50% from the current stock price of $232.87 [2][4][17]. Core Insights - The company reported total revenue of $94.9 billion for the quarter, a year-over-year increase of 6.1%, surpassing Bloomberg's consensus estimate of $94.4 billion. Product revenue was $70 billion, up 4.1%, while service revenue reached $25 billion, growing 11.9% [15][21]. - The gross profit was $43.9 billion, with a gross margin of 46.2%, exceeding the expected 46.0%. However, net profit fell to $14.7 billion, a decline of 35.8% year-over-year due to a one-time tax payment of $10.2 billion [15][22]. - The report highlights the launch of the iPhone 16, which features upgraded memory and processing capabilities, and anticipates that AI developments will drive future growth in both hardware and software revenues [16][38]. Financial Summary - The company’s net profit projections for FY2024 to FY2027 are as follows: $93.7 billion, $110.9 billion, $119.3 billion, and $126.5 billion respectively, with diluted earnings per share (EPS) expected to grow from $6.1 to $8.9 over the same period [12][17]. - Total operating revenue forecasts for the next few years are $391.0 billion for FY2024, $415.6 billion for FY2025, $442.3 billion for FY2026, and $464.0 billion for FY2027, reflecting a compound annual growth rate (CAGR) of 5.9% [13][49]. - The report indicates that the company’s cash and cash equivalents stood at $15.7 billion, with a net cash position of $5 billion, and it returned over $29 billion to shareholders through stock buybacks and dividends [22][37]. Product Performance - iPhone revenue for the quarter was $46.2 billion, showing a 6% year-over-year increase, with an average selling price (ASP) of $825, up $8 from the previous year [32][36]. - Service revenue reached $25 billion, marking a 12% increase, with over 1 billion paid subscribers across various services [37][40]. - The iPad and Mac segments showed growth, with iPad revenue at $7 billion (up 8%) and Mac revenue at $7.7 billion (up 2%), while wearables and accessories saw a decline of 3% to $9 billion [42][44]. Market Outlook - The report anticipates that the overall revenue growth for FY25Q1 will be in the low to mid-single digits, with gross margins expected to remain between 46% and 47% [15][26]. - The company is expected to benefit from a growing user base in India, with projected hardware sales exceeding $20 billion in the coming years [25].