Apple on track for massive App Store growth in Q2, analyst says

Apple’s App Store growth has reached multi-year highs and consumer spending on electronics continues to improve amid the COVID-19 pandemic, according to investment bank Morgan Stanley.


The growth of the Apple App Store has exceeded Morgan Stanley’s expectations, according to the firm’s data.

In a research note seen by Appleiphonestop on Wednesday, Morgan Stanley analyst Katy Huberty said the company is tracking improvements across many facets of the computer hardware industry.

On the one hand, preliminary data shows that growth in the App Store is off to a good start in the first quarter of June, with net revenues growing at least 31% year-on-year to reach $ 1.7 billion. This is well above previous forecasts of 18% year over year.

The total number of downloads on the App Store also increased by 40% compared to the quarter of the previous year, the strongest growth since Morgan Stanley started to track download data in 2015. The analyst’s growth rates on the App Store are expected to peak in the June quarter as countries have begun to relax coronavirus lockout measures. – the main plant which, according to Huberty, is the source of the outperformance.

In another promising move for Apple, Huberty writes that consumer spending intentions continue to improve.

2,000 respondents to Morgan Stanley’s AlphaWise service say current and future consumer electronics spending intentions hit a record high last week, as more respondents say they will spend less and expect to spend less.

As Huberty points out, this is an important measure, as investors question whether the increase is due to government stimulus or something more sustainable.

Credit: Morgan Stanley
Credit: Morgan Stanley

Morgan Stanley also updated some of its air quality charts in China, indicating that Apple’s supply chain in cities like Shenzhen and Zhengzhou reached historically “normal” levels as of May 4.

Finally, the analyst said he expects Apple to continue to reopen its stores as countries relax travel restrictions. By May 7, Apple is expected to open 75 of its 510 total brick and mortar locations, including Apple Stores in South Korea, Austria and Australia.

The investment bank will also be monitoring parameters such as Apple’s first supply and demand data points in China and IDC hardware data over the coming weeks.

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