FORTUNE -- Apple's (AAPL) computers cost more than its competitors' -- an average of $700, according to Needham's Charlie Wolf. Yet its market share, as indicated by Figure 1, has grown in 10 out of the last 11 years.
iPhones also cost more than the competition. Yet Apple's worldwide smartphone market share peaked at 23.8% in December 2011 and has been bouncing around at lower levels ever since. (See Figure 6.)
Why the difference? Wolf has a different theory for each device.
The Mac, he says, "seems to defy the laws of economics."
"The only explanation that we see," he writes, "is the now-mythical halo effect. Beginning with the iPod in the middle of the past decade and then extending to the iPhone and iPad, a meaningful number of Windows users who bought these products seem to have switched from a PC to a Mac... What should be underscored is how unique the Mac phenomenon is. Indeed, it's the only situation we've encountered where shifts in the demand curve completely swamped movements along the curve itself.
"In the face of rising relative prices, we view the Mac's success as the rare instance where sales increased in the face of rising prices."
The iPhone is not so fortunate. But its loss of market share, Wolf believes, has more to do with geography and carrier business models than, say, the prevailing theory: screen size.
"The iPhone's loss of worldwide market share," he writes, "chiefly reflects the shift in smartphone market share from developed, postpaid markets to emerging, prepaid markets. This shift was not driven by a change in consumer behavior but rather by rapidly falling prices of smartphones, especially in Asia Pacific, which induced feature phone users to switch to smartphones. We calculate that the iPhone's share of the smartphone market would be over ten percentage points higher were it not for the migration of smartphone sales from developed to emerging regions."
Is that good news for Apple or bad? That depends, I suppose, on what the iPhone demand curve does as the developed world's markets mature.
In 30 quarters, its market share grew 150% and its profit share 270%. Has that run ended?
FORTUNE -- Needham's Charlie Wolf has been following Apple (AAPL) long enough to still care what's happening to the Mac,* and on Tuesday he took a crack at explaining why the company's most venerable product line (it turns 30 in January) seems to have, as he puts it, "fallen back to earth."
Beginning in 2005, MOREPhilip Elmer-DeWitt - Nov 19, 2013 10:51 AM ET
The analyst with the Street's second highest Apple price target just lowered his to $595.
FORTUNE -- In September 2012, when Apple (AAPL) was selling for over $700 a share, more than half the analysts we track had price targets in the $750 to $900 range.
By Friday, only two were still at $700 or higher, and on Monday, one of them -- Needham's Charlie Wolf -- lowered his Apple target from MOREPhilip Elmer-DeWitt - Aug 12, 2013 9:54 AM ET
China's "white-box" manufacturers may now be the major engine of growth.
FORTUNE -- Consider the two charts at right.
Both were drawn from Gartner's worldwide market share data by Needham's Charlie Wolf, who issued his quarterly report on the smartphone market earlier this week.
The first shows Android cutting into the market share gains Apple (AAPL) made at the end of 2012 when it launched the iPhone 5 and cut the price of the MOREPhilip Elmer-DeWitt - Jun 29, 2013 10:53 AM ET
The difference between Wolf and Wall Street may be that he values Apple's cash holdings
FORTUNE -- There's something about Charlie Wolf's approach to Apple (AAPL) that I find charmingly old school -- perhaps because he's been in the business even longer (14 years at First Boston and 15 at Needham & Co.) than I have.
Most analysts seem to change their mind about Apple's prospects every time the wind shifts; Baird Equity's MOREPhilip Elmer-DeWitt - Feb 25, 2013 12:43 PM ET
How special are Apple Inc.'s retail outlets?
FORTUNE -- "I don't have very many bad days," Apple (AAPL) CEO Tim Cook told the audience at Goldman Sachs' technology conference Tuesday. "But if I ever feel that I'm dropping down from an excited level, I go and visit a store. It's like a Prozac."
Cook's point was that Apple's retail outlets are not like ordinary stores. "I'm not even sure 'store' is the right MOREPhilip Elmer-DeWitt - Feb 13, 2013 8:17 AM ET
Like the tortoise in Achilles' footrace, they may be perpetually unreachable goals
"There's scant evidence that the stock market itself has paid much if any attention to analysts' price targets in recent years," writes Needham's Charlie Wolf in a note to clients Thursday that raises his own Apple (AAPL) target $80 to $620.
He's got a point. the average target among the two-dozen analysts we sampled on October 19, the day after Apple's MOREPhilip Elmer-DeWitt - Feb 9, 2012 9:14 AM ET
In terms of revenue per sq. ft., think Tiffany's (its nearest rival) multiplied nearly threefold
Apple Stores are always busy places, but they tend to go crazy when a major new product is launched. With the arrival of the iPhone 4S, writes Needham's Charlie Wolf in his tenth annual report on the state of Apple's (AAPL) retail empire, they went absolutely nuts.
The numbers for the quarter that ended Dec. 31:
Revenue per MOREPhilip Elmer-DeWitt - Feb 5, 2012 7:35 AM ET
Goldman Sachs, Needham and Hudson Square Research issue new notes
You can tell you're getting close to an Apple (AAPL) earnings report when the analysts start dusting off their spreadsheets and issuing new estimates. At least three came in on Monday.
Needham's Charlie Wolf made the biggest adjustment, hiking his earnings estimate to $10.85 from $9.55 on Street-high sales of $41.15 billion, up more than $3 billion from his previous estimate. He MOREPhilip Elmer-DeWitt - Jan 9, 2012 12:57 PM ET
Charlie Wolf invokes "Diffusion of Innovations" in raising his Apple price target to $540
In Everett Rogers' classic text on how innovations percolate through societies, he describes how hybrid corn, despite 20% higher yield and resistance to drought, took two decades to become ubiquitous in the farms of Iowa. High-tech innovations spread more quickly these days, but they too follow Rogers' S curve, from early adopters to mainstream use to late MOREPhilip Elmer-DeWitt - Aug 6, 2011 7:47 AM ET
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