Although Apple has been relatively quiet about its June patent lawsuit settlement with Nokia, details may emerge when the tech giant releases is third-quarter financial report, an analyst writes Wednesday.
The question of whether Apple got a good deal or will take a hit on settling its long-running patent dispute with Nokia could be known when the iPad maker talks unveils its quarterly report July 19. They key is the accounting phrase “accrue.”
“If Apple had been accruing [translation: saving money] for Nokia royalties and brokered a more favorable rate, we believe it could see a 1x benefit to gross margins,” UBS Investment Research analyst Maynard Um told investors.
However, if Apple hadn’t been saving up for a potential royalty payment to Nokia, the decision “would likely have an adverse impact,” Um adds. For now, the analyst believes Apple had been saving up cash for a royalty payout and likely got a good deal, paying a several-hundred million dollar one-time royalty fee.
There are other signs Apple will announce strong profits. First, reports indicate the Cupertino, Calif. company has received good prices for parts at a time when demand for Macs, iPads and iPhones are high. Secondly, the company’s back-to-school offer included a $100 Mac App Store gift card, rather than the more expensive iPod touch.
The switch to gift cards fosters “a consumer dependence on the company for digital media, content, software, etc. that serves to promote the use and purchase of its hardware in order to seamlessly manage, access and consume this content,” Um concludes.
