Apple Reportedly Developing Budget Mac To Take On Low-Cost Chromebooks, Windows PCs

• According to a Bloomberg News report, the laptop was code-named J700 and was currently in active testing at Apple, as well as in early production with overseas suppliers.
• Bloomberg noted, citing people familiar with the matter, that the new low-cost laptop would be developed for students, businesses, and casual users.
• The move comes on the heels of Apple's fourth-quarter results last week that showcased softness in iPhone sales resulting from supply constraints.

Apple Inc. (AAPL) is reportedly eyeing the low-cost laptop market and plans to build a budget-friendly Mac for the first time, as the iPhone maker seeks to attract consumers who are looking for lower-priced alternatives to Chromebooks and Windows PCs.

According to a Bloomberg News report, citing people familiar with the matter, the new low-cost laptop would be developed for students, businesses, and casual users. The report added that it will target people who primarily browse the web, work on documents, or conduct light media editing.

Bloomberg noted that Apple is also looking to appeal to potential iPad customers who prefer a traditional laptop experience.

Holiday Quarter Outlook

The move comes on the heels of Apple's fourth-quarter results last week that showcased softness in iPhone sales resulting from supply constraints. However, Apple’s CFO Kevan Parekh said that for the holiday quarter, the company expects iPhone revenue to grow in double digits year-over-year.

Parekh added that it would be the “best iPhone quarter ever.”

According to TheFly, UBS stated in a note on Tuesday that, based on an analysis of Sensor Tower data, global App Store revenue grew 8% on a currency-neutral basis in October, approximately 110 basis points faster than in September.

According to UBS, the global App Store grew 9% on a reported basis in October, marking the second consecutive month of high-single-digit growth following September's 7%.

Retail sentiment on Apple remained unchanged in the ‘extremely bullish’ territory, with message volumes at ‘extremely high’ levels, according to data from Stocktwits. Shares of Apple rose 0.5% in afternoon trading.

Pricing Of The Laptop

Bloomberg reported that the laptop was code-named J700 and was currently undergoing active testing at Apple, as well as in early production with overseas suppliers. According to the report, Apple plans to launch it in the first half of next year.

The report noted that Apple intends to sell the laptop for well under $1,000 by using less advanced components. The company would use an iPhone processor and a lower-end LCD, Bloomberg said, adding that the screen will also be the smallest of any current Mac.

Shares of Apple have gained over 21% in the last 12 months.

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