In This Article:
As the US sales ban on the Apple Watch Series 9 and Ultra 2 goes into effect, Apple (AAPL) has filed an emergency request to stop the ban as the court considers the appeal. Creative Strategies CEO and Principal Analyst Ben Bajarin joins Yahoo Finance to discuss the ban and how it may impact Apple.
"I think it really depends on the length of the ban," Bajarin says. "This news is priced" into the stock, "but I think people are also betting that this sales ban's not going to last a full year... It's really how does this get resolved and how long does this go out?"
"I don't expect this to last really the full year, at least we hope not, so we want resolutions sooner than later. But I think Apple's really trying to come at this from a software solution to start with at least," Bajarin adds.
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Video Transcript
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JOSH LIPTON: The ban on Apple Watches is now in effect. And the tech giant fighting back. Company filing an emergency request to lift the ban on Watch sales, while the court considers the appeal. One report says the Watch business generating roughly $17 billion a year. Joining us now is Creative Strategies CEO and principal analyst Ben Bajarin.
Ben, it is great to see you. Let's get right down to what traders, investors, business people, Ben, what they want to know is what is the revenue impact of all this right now. Morgan Stanley crunched the numbers for us. I don't know if you saw this. Here's their estimate, Ben. They say for every week that Apple can't sell, the Apple Watch Series 9 and Ultra 2 in the US, by their math, the company is losing about $135 million in revenue.
Now to Apple that is not material. That's not a lot. But it is coming in this broader context, Ben, where, listen, Apple is trying to get that topline moving again. You know, for four quarters now, Ben, a declining sales that company. So add it up for us, for investors listening right now, is this big deal, no deal, how do you see it?
BEN BAJARIN: Yeah. I think it really depends on the length of the ban. I mean, obviously, I think those-- the numbers you estimated from Morgan Stanley, I've seen similar in terms of the size of the business, right, Apple ships anywhere between 30 and 40 million Apple Watches a year. Big numbers, obviously, those periods are cyclical, right? They might sell more in a holiday season more than the upfront part of first six months-- first three or six months of the year.
I think the stock is relatively-- this news is priced in at the moment. But I think people are also betting that this sales ban is not going to last a full year, for example. So it's really how does this get resolved and how long does this go out. But we've been checking with other retailers who still have some stock, which means that they did push some of that into the channel in advance of this, so it seemed like there was inventory. But I think they can't take new sales of that product post-ban, but they're still selling through that inventory that they have.