Apple(US:AAPL) Ping An Securities·2026-02-01 11:31Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry index is expected to perform better than the market by more than 5% over the next six months [9]. Core Insights - Apple's revenue for the first quarter of fiscal year 2026 reached $143.76 billion, a year-on-year increase of 16%, with net profit at $42.10 billion, also up 16%. Earnings per share rose by 19% to $2.84 [7]. - iPhone revenue, as a key growth driver, amounted to $85.27 billion, reflecting a 23% year-on-year growth and accounting for 59.3% of total revenue. Service revenue was $30.01 billion, up 14%, while iPad revenue grew by 6% to $8.60 billion. However, Mac revenue declined by 7% to $8.39 billion, and wearables, home, and accessories revenue fell by 2% to $11.49 billion [7]. - In the Greater China region, revenue reached $25.53 billion, marking a significant 38% year-on-year increase, while the Americas and Europe saw revenue growth of 11% and 13%, respectively [7]. Market Outlook - Global smartphone shipments are projected to grow by 2% in 2025, reaching 1.25 billion units. The top five smartphone manufacturers in terms of shipments are Apple, Samsung, Xiaomi, Vivo, and OPPO, with respective shipments of 241 million (up 7%), 239 million (up 7%), 165 million (down 2%), 105 million (up 4%), and 101 million (down 3%) [7]. - For 2026, due to rising DRAM prices, the cost of smartphone Bill of Materials (BoM) is expected to increase by approximately 25% for low-end models, 15% for mid-range, and 10% for high-end models, with a potential further increase of 10%-15% by the second quarter of 2026. Consequently, global smartphone shipments are anticipated to decline by 2.1% year-on-year [7]. - The average selling price of smartphones is expected to rise by 6.9% in 2026 due to cost pass-through and product mix adjustments [7]. Investment Recommendations - Short-term pressures from rising storage costs are noted, but emerging products such as foldable phones, AI smartphones, and AI glasses present new growth opportunities for the industry. Companies to watch include Luxshare Precision, Lixun Precision, GoerTek, Lens Technology, and Xinwei Communication [7].