Apple's price adjustments to its lineup of iPhone and iPad this week would have less effect on the firm's bottom line, projects analyst Gene Munster of Piper Jaffray, as reported by an article in Apple Insider. He said the new 8GB iPhone 5c release internationally this month and iPad 4's relaunched for $399 have a "less positive" benefit for the Cupertino company throughout the next two quarters.
The new iPhone 5c 8-gigabyte in particular, which costing lies between iPhone 4s entry level and iPhone 5c 16GB is "unlikely to drive more significant upside", said the analyst as a note to investors.
Apple tried out lower pricing last year, cutting prices of entry levels of iPhone 4 by approximately 15 per cent in the emerging markets like India and China. The price cut was believed to have helped the Cupertino giant to beat expectations of the iPhone unit in June 2013 by 18 per cent.
Munster believes Wall Street expects the Cupertino's June quarter, down lower before the firm reports the results. However, the analyst has not much belief on the lower capacity, lower priced iPhone 5c to have similar level of impact in 2013. He calls iPhone 5c 8GB launch "ultimately irrelevant" to its maker's June quarter.
Munster is more concerned on the consensus estimates for June quarter of Apple. Wall Street expects the firm to revenue report $38.7 billion for the three-month time, a representation of the 10 percent yearly growth. This figure is too high, as to Munster's beliefs, considering the absence of meaningful changes to Apple's products or some identifiable trends that head into June; thus, an unlikely for Wall Street's expectation of significant acceleration, Munster wrote.
The analyst believes Wall Street's estimate for June will come down eventually, prior to the actual reporting of Apple for the quarter results. He does not expect either, any effect to the stock price.
Apple launched its new 8GB iPhone 5c on Tuesday to select markets worldwide, including U.K. France, Germany, Australia and China. U.S., Apple's home country is not included.
The aging iPad 2 was discontinued this week and replaced by $399 price point of a resurrected 4th-gen iPad with Retina. Apple's active lineup now uses Lightning connector. The first-gen iPad mini sold at $299 is the sole non-Retina tablet for sale.