From: Richard Kahn
To: Jeffrey Epstein <jeevacation@gmail.cont -
Subject: Fwd: Apple, Inc.: Long-awaited Mac/iPad Upgrades
Date: Tue, 30 Oct 2018 17:23:10 +0000
Richard Kahn
HBRK Associates Inc.
575 Lexington Avenue 4th Floor
New York NY 10022
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Begin forwarded message:
From: "Morgan Stanley"
Subject: Apple, Inc.: Long-awaited Mac/iPad Upgrades
Date: October 30. 2018 at 1:19:02 PM EDT
To:
Reply-To: <
glaMorgan Stanley
Wealth Management
Apple. Inc.: Long-awaited Mac/iPad Upgrades
ge,Download Report
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Katy L. Huberty, CFA - Morgan Stanley
October 30, 2018 5:15 PM GMT
Earlier today, Apple unveiled a new line of iPad Pro, Macbook Air, and Mac Mini devices,
which was largely in-line with investor expectations. Previous iPad events aren't typically
stock moving events for Apple - shares have underperformed vs. the S&P by 30bps on the
day of the event but outperformed by 30bps one week after the event - however, we view
the new product line up as a positive step forward in 1) improving Apples overall ASP
trajectory, 2) increasing brand loyalty, and 3) opening the door for a more comprehensive
gaming experience. The refreshed products are the first to integrate some of the new
technology first offered in the iPhone X, such as Face ID (iPad Pro), a new Al2X Bionic
chip (iPad Pro), retina display (Macbook Air), and a new T2 security chip (Macbook Air and
Mac Mini). Other improvements were mostly iterative features such as improvements in
memory and storage capacity. In our view, the most impressive new feature announced
was the iPad Pro's updated creative pro and gaming capabilities. Enabled by the new Al2X
Bionic chip, the iPad Pro is able to deliver graphics on par with the Xbox One S, creating an
experience that attempts to rival console gaming with demo of NBA 2K from Take-Two
Interactive. Adobe also showcased an impressive demo of image editing in Adobe
Photoshop with augmented experience in Project Aero. While Mac and iPad combined only
represent 17% and 11% of FY18e revenue and gross profit, respectively, today's
announcements further enhance the Apple device ecosystem and enable customers to
better take advantage of Apples many Services offerings.Other Apple/ICS updates
announced today include:iOS 12 was installed on more devices in the first month than any
past iOS. 60% of iPhone base now uses iOS 12. Apple shipped 400M iPads to-date with
more iPads sold in the last year (44.2M) than any other Notebook vendor.Active Mac
installed base recently reached 100M, implying a —5 year upgrade cycle. 51% of Mac
buyers are new to t
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