Ignore The Rampant Negativity In Apple, The Proof Of The Pudding Is In Foxconn Data This Morning

Almost every day, you have a Wall Street analyst, website (Apple-centric or not), talking head, kindly uncle, the always-short-never-losing-money crowd and/or the do-over Dudley's (yes, that is my new category of investors) waxing negative about Apple (and pretty much every other stock in techland) and pontificating about the problems the company is having in almost every product category.


Of late, the chatter is that the whiz-bang, high-end Apple phone will be delayed due to what the above group claims are a variety of issues dealing with design, production, fingerprint sensors, 3D sensors and who knows what other problems.


Sell-siders are speculating that there is a "significant redesign" that will lead to delayed launch of the high-end model, others are saying that company is having software issues and problems with its fast wireless charging solutions, issues with the 3D camera, others in the above category are saying that expectations are too high for Apple and some are also speculating that the iPhone 8 and the iPhone 7s will ship without inductive chargers, which will be sold separately later.


While all of the above might turn out to be true (or not at all) for shareholders, it should matter not one single bit.


Even if there is a delay due to all these above problems, the potential for absolutely bust-out numbers in the following quarters will be absolutely huge. Remember the AirPod, where supply has still not caught up with demand. The same negativity was heard around the world before the launch of the AirPod late last year.


However, if one is a shareholder, he/she only needs to take a look at the following press release from Foxconn this morning regarding its June sales data. (Foxconn aka Hon Hai).


Foxconn Technology has reported consolidated revenues of $10.139 billion for the month of June, up 12.6% month on month and up 3.2% year-on-year.


The company said that 2017 YTD revenues (till June end) were $40.954 billion, up 11.22% compared with the same period last year.


(Please note I have used an FX rate of NT 0.033=$1 USD to convert the numbers reported by FoxConn)


FoxConn reported gets at least 50% of its revenues from Apple and in actuality that percentage is even higher.


This past Monday, another one of Apple's suppliers, Taiwan Semi also reported sales data for June which were up a more sedate 3% year-on-year but still up is the key takeaway.


Get ready for even more intense negativity regarding Apple (and the rest of techland for that matter) as we near its earnings date on August 1, however, as the title says, the proof is in the pudding.


Apropos given the runaway negativity, Apple shares are down $0.30 to $145.24 per share.


(Long aapl, long and short options)

Original Link
https://www.forbes.com/sites/jaysomaney/2017/07/12/ignore-the-rampant-negativity-in-apple-the-proof-of-the-pudding-is-in-foxconn-data-this-morning/#5b0dd1191866