I have written about inari yesterday.
Today this kopi-o research i added in latest data.
Key Observation:
(1) Noticing the average quarter revenue for singapore segment from FY 14 to FY 18:
RM 157.9 mil --> Rm 199.9 mil --> Rm 209.9 mil --> Rm 218 mil --> RM 253.4 mil --> RM 256 mil (1 quarter).
FY 2017 show high base of growth due to iphone X and causes excess inventory.
(2) Supply chain excess inventory has returned to normal. This ease my mind.
(3) Demand for RF has again returned to normal growth.
(4) Samsung Q3 shipment is the real culprit for inari Q1 FY 2019. It has falled by 13.4% and has resulted in lower volume loading for Iris scanner volume in Inari
(5) Also interesting is the supply chain effect. If you notice FY 16 Q1 & Q2 high base revenue (probably causing excess inventory too in the supply chain) has resulted significant drop in FY 16 Q3 & Q4. The effect has prolonged into FY 17 Q1 & Q2. But leading to higher volume in FY Q3 & Q4 which traditionally should be low season.
All in all, i think inari is doing fine, just supply chain effect.
My Thoughts on Inari RF Business: Bullish!!!
THE Apple Ecosystem
You may have/ or have not heard about the term: Apple "Iphone Ecosystem". The ecosystem is basically a huge user base that apple has created over the past 10 years. To understand it, just imagine Apple is Airasia (of course, should be Tony wanted to be like Tim Cook), you have millions and millions of loyal customers to continue use your product, use your UPGRADED product, to experience all the excitement etc.
Let see Iphone models launched over the past 10 years:
If you noticed that iphone 5S launched in 2013 is still supported by Apple. More than 5 years. That raises 1 important question: Can competitors offer such durable phones?
While some media has demonised its longer-phone upgrade-cycle and used it to attack apple, I view it quite positively whereby the huge user carrying old iphone served as "RESERVE BANK" for future iphone models, while Apple continue to build / acquired new user. The phone upgrading cycle is self sustaining. Refer this link: https://www.statista.com/statistics/606147/iphone-model-device-market-share-worldwide/
As of Oct 2018,
(1) iphone 6S plus and older model around 27.66% (Dec 2017: 54.3%)
(2) Iphone 7/ 7 plus around 33% ( Dec 2017: 32.7%)
(3) Iphone 8/ 8 plus around 22% ( Dec 2017: 7.4%)
(4) iphone X around 14% (Dec 2017: 5.3%)
(5) Iphone Xs/ Xs max around 3.4%
From above statistic, about 50% of the Iphone 6S plus or older model user has upgraded thier phone.
To be more specific, iphone 6/ 6 Plus/ 6S / 6S Plus users was 41.6% in Dec 2017 and the active user has upgraded thier phones and make the number of 6/ 6 Plus/ 6S / 6S Plus users reduced to 19.1%.
While we see a big jump in iphone 8/ 8plus / iphone X.
To answer the the long pending doubt of iphone getting expensive ? above data show price tag is not really a problem within iphone ecosystem.
https://www.businessinsider.my/warren-buffett-apple-iphone-enormously-underpriced-2018-8/?r=US&IR=T
You probably hear people call themself "苹果粉丝“/ "I 疯" . They just love iphone.
So far we did not see "Iphone Super Cycle" as we see in 2014/2015 when big screen iphone 6S/ 6S plus launched. But a gradual progressive one. A good one.
We certainly going to see one when 5G launched. IoT is future. Nobody will be left behind. Part of the reason of super cycle in 2014/2015 could also be due to the use of 4G.
How many Apple product is active in use now?
1.3 BILLION Devices including mac, ipad, iwatch etc
[iphone - 1 Billion https://www.cultofmac.com/465968/iphones-user-base-to-surpass-1-million-units-by-2019/) ]
https://www.apple.com/newsroom/2018/02/apple-reports-first-quarter-results/
Don't forget, ALL DEVICES need more RF filters when signal moving in higher frequency.
Moving towards, more 4G, 4GLTE devices will be sold and eventually 5G will kicks in, the requirement for RF content will be in great to greater level.
Inari increases it RF testers capacity for another 25% for good reason.
https://www.mwrf.com/systems/top-5-rf-technologies-5g-iot
Conclusion:
(1) Iphone expensive? Price is never a problem to iphone itself, you are the problem indeed!
(2) tradewar fear? yes, this is one significant risk. But beyond my control. I have wrote my logic here. https://klse.i3investor.com/blogs/YiStock/164917.jsp
YiStock
https://klse.i3investor.com/blogs/Inari/183906.jsp
