EFTA02601998

From: jeffrey E. <[email protected]> Sent: Thursday, December 21, 2017 1:36 PM To: Richard Kahn Subject: Re: Apple, Inc.: iPhone X Accelerating Apple Share Gains in China call me <=r> On Thu, Dec 21, 2017 at 8:34 AM, Richard < > > wrote: Richard Kahn HBRK Associates Inc. 575 Lexington <https://maps.google=com/?q=575+LexingtonVoCrY0A0Avenue+4th+Floor+New+York,+NY%C2%A010022&e=try=gmail& source=g> Avenue 4th Floor <https://maps=google.com/?q=575+LexingtonVoC2P0A0Avenue+4th+Floor+New+York,+NY%C2e/cA01002=&entry=gmail& source=g> New York, NY 10022 Begin forwarded message: From: "Morgan Stanley"=<ms-wmir=morganstanley.com <mailto:[email protected]» Subject: Apple, Inc.: iPhone X Accelerating =pple Share Gains in China Date: December 21, 2017 at 12:24:04 AM EST<=r> To: <[email protected] < > > Reply-To: <mswmir-cie-feedback@morganst=nley.com <mailto:mswmir-cie- [email protected]» <http:=/www.morganstanley.com/imecs/spacer.gif> <=tr> W=alth Management <http://www.morganstanley.com/imecs/spa=er.gif> EFTA_R1_01790124 EFTA02601998 <http://www.morganstanley.com/cs/p=g/603696978_header.png> <http://=ww.morganstanley.com/img/cs/spacer.gif> Apple, Inc.: iP=one X Accelerating Apple Share Gains in China <http://linkback.morga=stanley.com/web/sendlink/webapp/f/lsin9kiq-3pv6-g000-b2d1- 005056015102?sto=e=l&d=UwBSZXNIYX*F9NUwA5MjVmYWUyOC1IMDFkLTExifctOGM2Ny0xYTNmN2U1=GM4MDk %3D&user=58fbo6vuhz7or-0&_gda_=1766121843_945f875fd9bb=a8537d207b5032b38a6> <http://www.morganstanley.com/im=/cs/spacer.gif> <http://www.morganstanley.com=img/cs/spacer.gif> <=mg src="http://www.morganstanley.com/cs/jpg/DownloadReport-Ig.jpg" alt=3D"Download Report" style="display:block;border:none;outline:none;text-d=coration:none" width="170" height="53" border="0"> <http://www.morganstanley.com/img/=s/spacer.gif> <http://www.morganstanley.com/img/cs/spacer.=if> <http://www.morganstanley.com/im=/cs/spacer.gif> <http://www.morganstanley.com=img/cs/spacer.gif> <http://www.morganstanley.com/img/cs/sp=cer.gif> Kat= L Huberty, CFA — Morgan Stanley December 21, 2017 5:=1 AM GMT Initial iPhone X data points in China highlight faster ado=tion vs. iPhone 8/8 Plus and increasing switching opportunity (to Apple), =ueling an acceleration of Apple smartphone share gains. Google Trends data=also corroborate iPhone strength in China. AAPL remains our top pick enter=ng 2018. Initial iPhone X China data show faster adoption vs. iPhone 8 =nd 8 Plus. Recall, three weeks ago we published a report on data that we a=alyzed in conjunction with Alpha Wise that aggregates smartphone data from = push-messaging service in China, highlighting Apple's growing share o= active smartphones in China — which runs counter to the consensus=view that Apple is losing share to cheaper smartphone brands in China (1).=We now have data through November 19 that bolsters our bullish China thesi=. This additional data show that iPhone X adoption in China is on a faster=pace than the iPhone 8 or 8 Plus. As 2 depicts, iPhone X represented 0.36%=of the iPhone installed base in China through November 19, higher than the=initial adoption of the iPhone 8 or 8 Plus. Importantly, the data through =ovember 19 only contains 16 days of iPhone X availability, whereas the com=arable period for the iPhone 8 and 8 Plus includes a full 28 days. As a re=ult, we expect further acceleration of iPhone X relative to iPhone 8/8 Plu= in the next data release.iPhone X data show runway for iPhone upgrades. D=spite faster penetration of iPhone X vs. iPhone 8/8 Plus, we believe there=remains significant pent-up demand from the base of 2+ year old iPhone own=rs. This is because 48% of upgraders to iPhone X upgraded from the iPhone = and 7 Plus (3), meaning early adopters are driving demand at the beginnin= of the cycle. Compare this to upgrader data for the iPhone 8 and 8 Plus (=) that show 43% and 46% of upgraders, respectively, in the November 19 per=od, came from the iPhone 6 and 6 Plus generation. As a result, we believe =pgrades to the iPhone X from the base of 2-year-old iPhone owners, which i=span class="m_1434519441706473062Apple-converted-space"> =/u> Th=s alert is sent from: Andrew At=as, morganstanley.com <mailto:[email protected]> You received this because you requested that you receive conte=t and reports from: APPLE INC. Please contact your FA if you want to unsub=cribe from the alerts. 2 EFTA_R1_01790125 EFTA02601999 <http://www. chttp://www. <=d style="border-collapse:collapse"> <http://www.morganstanley.=om/img/cs/spacer.gif> <=td> <http://www.=organstanley.com/img/cs/spacer.gif> morganstanley.com/im=/cs/spacer.gif> <http://www.morganstanley.coqimg/cs/spacer.gif> <http://www.morganstanley.com/img/cs/s=acer.gif> morganstanley.com/img/cs/spacer.gif> <=td> Disclosures: Please see the full report for risks, disclosures a=d other important information. Important disclosures regarding the rel=tionship between the companies that are referenced in Morgan Stanley resea=ch and Morgan Stanley Wealth Management research are available on the Morg=n Stanley Wealth Management disclosure website at https://w=w.morganstanley.com/online/researchdisclosures <https://www.morga=stanley.com/online/researchdisclosures> . Morgan=Stanley Wealth Management Not Acting as Municipal Advisor Morgan Stanley W=alth Management is not acting as a municipal advisor to any municipal enti=y or obligated person within the meaning of Section 1SB of the Securities =xchange Act (the "Municipal Advisor Rule") and the opinions or v=ews contained herein are not intended to be, and do not constitute, advice=within the meaning of the Municipal Advisor Rule. Copyright The copyri=ht in materials provided by Morgan Stanley is owned by Morgan Stanley &= Co. LLC. Morgan Stanley Wealth Management is the trade name of Morgan Sta=ley Smith Barney LLC, a registered broker-dealer in the United States. © 2017 Morgan Stanley Smith Barney =LC. Member SIPC. <http://www.morg=nstanley.com/img/cs/spacer.gif> <http://www.morganstanley.com/img/=s/spacer.gif> <http://www.morganstanley.com/img/cs/spacer.=if> =img src="http://www.morganstanley.com/img/cs/spacer.gif" width="1" hei=ht="1"> <http://ww=.morganstanley.com/img/cs/spacer.gif> <http://www.morganstanley.com/=mg/cs/spacer.gif> <http://www.morganstanley.com/img/cs/spacer.gif> <http://www.m=rganstanley.com/img/cs/spacer.gif> <http://www.morganstanle=.com/img/cs/spacer.gif> <http://www.morganstanley.com/img/cs/spacer.=if> <=mg src="http://www.morganstanley.com/img/cs/spacer.gif' width="22" hei=ht="8"> <http://ww=.morganstanley.com/img/cs/spacer.gif> <http://www.morganstanley.com=img/cs/spacer.gif> <http://www.morganstanley.com/img/cs/spacer.gif> 3 EFTA_R1_01790126 EFTA02602000 40=A0 please note The information contained in this=communication is confidential, may be attorney-client privileged, mayconstitute inside information, and is intended only for the use of the=addressee. It is the property of JEE Unauthorized use, disclosure or=copying of this communication or any part thereof is strictly prohibite= and may be unlawful. If you have received this communication in err=r, please notify us immediately by return e-mail or by e-mail to [email protected]<=a>, and destroy this communication and all copies thereof, including=all attachments. copyright -all rights reserved --001a113d415ca7ce7f0560d9c654-- conversation-id 30186 date-last-viewed 0 date-received 1513863340 flags 8590195713 gmail-label-ids 7 remote-id 780154 4 EFTA_R1_01790127 EFTA02602001