While Apple's (NASDAQ:AAPL) Worldwide Developers Conference earlier this month was void of any new hardware, Apple fans may get a slight "fix" next week. French site MacGeneration (via MacRumors) is reporting that Apple is planning to update its iMac line next week with faster processors and lower prices.
The new iMacs
The refresh is likely to be minor, with the key difference likely being upgraded configurations for the desktop computer's processor. This is no surprise; In the past, Apple's iMac updates are often driven by availability of new processors. And recently launched Intel processors appear to be a good fit.
MacRumors shared details on what it is expecting from Apple:
Like the MacBook Air refresh, Apple may be planning to increase the processor speed of at least some configurations by 100 MHz by using a number of recently launched processors, including the 3.3 GHZ i5-4690, the 3.5 GHz i5-4690, and 3.6 GHz i7-4790 for the 27-inch model as well as the 3.0 GHz i5-4590S and 3.2 GHz i5-4790S for the 21.5-inch model. It is also possible that Apple will cut the price of the standard iMac configurations to go along with these minor spec bumps.
While the processors may be the biggest predicted change to the hardware, it will be the price cuts that will likely receive the most attention. The reliable Ming-Chi Kuo, analyst of KGI Securities, has been predicting since last year that the company would launch a lower-cost iMac.
Why would Apple launch lower-cost iMacs? Kuo reasons that it would help Apple address growth opportunities in foreign markets. More specifically, he predicted in April that it could boost iMac sales by 23%. Apple's envious average selling price for its Mac business, which more than doubles the global average ASP for PCs, combined with Mac sales momentum that has outpaced the overall market in 30 of the last 31 quarters, give Apple plenty of wiggle room to make such a move.
While Apple doesn't break down its Mac business by desktop and laptops, 23% growth in iMacs in 2014 would undoubtedly be a meaningful driver for the segment. In the company's most recent quarter, the business performed better than the overall PC market again, but the growth is relatively slow compared with Apple's largest segment: iPhones. Unit Mac sales were up 5% and revenue was up just 1%, year over year. A lower-cost iMac could help Apple sustain year-over-year revenue growth a bit longer.
But will incremental Mac business growth make a difference for Apple investors? Hardly. The segment accounts for just 12% of the company's revenue and probably an even smaller percentage of operating income. It's iPhones and iPads, which together account for about 74% of Apple's revenue, that are driving the majority of Apple's business.
Daniel Sparks owns shares of Apple. The Motley Fool recommends and owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.