iPhone sales predicted to top 80 million by 2012
New reports forecast that Apple will sell 50 million phones in 2011, and more than 80 million in 2012, as worldwide expansion and popularity of the iPhone continues to grow.
Apple shipped 13.7 million iPhones in the 2008 calendar year, and the number continues to grow. Last quarter alone, the Cupertino, Calif., company sold 5.2 million iPhones riding the successful launch of the iPhone 3GS. But two new predictions call for the mobile platform to reach astounding new heights worldwide in the next few years.
Bernstein Research
In a note from Bernstein Research this week, hardware analyst Tony Sacconaghi said that Apple will sell more than 50 million iPhones per year by the September 2011 fiscal year. The report, as relayed by Barron's, predicts the entire market for smartphones will grow 27 percent per year in both 2010 and 2011.
A major factor in the iPhone's predicted growth, as seen by Sacconaghi, is the platform's expansion to other carriers. In particular, the analyst expects Apple will sell 11 million phones alone in 2011 by offering the phone on Verizon Wireless in the U.S. With growth in Europe and expansion into China on the company's agenda, Bernstein Research believes Apple could easily achieve the 50 million goal. The firm has a $185 price target for AAPL stock and maintains its "Overweight" rating.
RBC Capital Markets
Similarly, Mike Abramsky, analyst with RBC Capital Markets, predicts that the iPhone will have 5.7 percent total addressable market share by 2012, well up from the 1.1 percent overall share held today. In the company's latest report, RBC has raised its price target for AAPL to $250, maintaining an "Outperform" rating.
Abramsky believes that total iPhone shipments will hit 82.1 million in 2012, good for a 16.3 percent share of the smartphone-specific market.
"Despite the iPhone’s introduction more than two years ago, competitors continue to lag iPhone’s sleek touchscreen experience, robust third-party applications platform, and tight multimedia integration," Abramsky said. "Off the strength of its brand, innovation, and customer loyalty, Apple is expected to retain its premium carrier subsidy versus competitors, sustaining above-peer margins for its smartphones. We believe Apple will sustain its lead in content, games, and apps, which we expect to expand to include mobile commerce, user-generated content, advanced gaming, etc."
The 92-page report predicts smartphones will see explosive growth in the next few years, calling them "the next wave of computing" and predicting shipments will exceed that of PCs in 2011. Abramsky believes that the devices could become the principal way in which people browse the Web, send e-mails, listen to music, watch TV, play games and more. The report increases the firm's prediction for smartphone penetration, calling for a 35.1 percent share of global handsets, totaling 504 million, in 2012.
Apple shipped 13.7 million iPhones in the 2008 calendar year, and the number continues to grow. Last quarter alone, the Cupertino, Calif., company sold 5.2 million iPhones riding the successful launch of the iPhone 3GS. But two new predictions call for the mobile platform to reach astounding new heights worldwide in the next few years.
Bernstein Research
In a note from Bernstein Research this week, hardware analyst Tony Sacconaghi said that Apple will sell more than 50 million iPhones per year by the September 2011 fiscal year. The report, as relayed by Barron's, predicts the entire market for smartphones will grow 27 percent per year in both 2010 and 2011.
A major factor in the iPhone's predicted growth, as seen by Sacconaghi, is the platform's expansion to other carriers. In particular, the analyst expects Apple will sell 11 million phones alone in 2011 by offering the phone on Verizon Wireless in the U.S. With growth in Europe and expansion into China on the company's agenda, Bernstein Research believes Apple could easily achieve the 50 million goal. The firm has a $185 price target for AAPL stock and maintains its "Overweight" rating.
RBC Capital Markets
Similarly, Mike Abramsky, analyst with RBC Capital Markets, predicts that the iPhone will have 5.7 percent total addressable market share by 2012, well up from the 1.1 percent overall share held today. In the company's latest report, RBC has raised its price target for AAPL to $250, maintaining an "Outperform" rating.
Abramsky believes that total iPhone shipments will hit 82.1 million in 2012, good for a 16.3 percent share of the smartphone-specific market.
"Despite the iPhone’s introduction more than two years ago, competitors continue to lag iPhone’s sleek touchscreen experience, robust third-party applications platform, and tight multimedia integration," Abramsky said. "Off the strength of its brand, innovation, and customer loyalty, Apple is expected to retain its premium carrier subsidy versus competitors, sustaining above-peer margins for its smartphones. We believe Apple will sustain its lead in content, games, and apps, which we expect to expand to include mobile commerce, user-generated content, advanced gaming, etc."
The 92-page report predicts smartphones will see explosive growth in the next few years, calling them "the next wave of computing" and predicting shipments will exceed that of PCs in 2011. Abramsky believes that the devices could become the principal way in which people browse the Web, send e-mails, listen to music, watch TV, play games and more. The report increases the firm's prediction for smartphone penetration, calling for a 35.1 percent share of global handsets, totaling 504 million, in 2012.
Comments
The also-rans need to step up their game if they want to avoid an iPod-like bloodbath. It's in the mail, folks, and it's not looking too good for the other players so far.
250M smart phones by 2012 seems a little high... but I can see Apple getting close to 50% market share if the company adopts a multi carrier model once LTE is deployed. Usually the stock price tops out long before the market share and volume tops out. This has been an expensive lesson I have learnt in riding technology trends. So an exit strategy will be important, especially if the market cap gets close to $250B.
The main impediment to Apple selling even more phones is the carrier limitation. The apps are what increases the value of the iPhone. Nobody even comes close. If carrier adoption becomes universal, the company could achieve 50% market share. However a multi carrier model may affect ASP via reduced subsidies... any opinions here?
250M smart phones by 2012 seems a little high... but I can see Apple getting close to 50% market share if the company adopts a multi carrier model once LTE is deployed. Usually the stock price tops out long before the market share and volume tops out. This has been an expensive lesson I have learnt in riding technology trends. So an exit strategy will be important, especially if the market cap gets close to $250B.
With 5 iphone models including a nano phone and tablet phone by 2013 apple could easily reach 300m in sales.
easily. The used phones get passed on to family or to craig list >> ever increasing the iser base and user love for the iphone platform . Remember when dick tracey make a video call from hos watch ?? that day is almost here .
a WATCH pod phone .
peace
Let me explain.
Assume 80M iPhones sold in 2012 at an average price of $500 per phone => $40B in iPhone revenues. If Apple gets its average 15% profit margin (a very conservative assumption, since iPhone margins are higher the company's average), that is $6B in iPhone profits by 2010. At a P/E of 20, that's worth $120B in market cap. Discounted back to mid-2009 at a cost of equity of 15%, the present value is $85B today. With approximately 900M shares outstanding, that is ~$95 per share in Apple stock price from just in its iPhone line of business! Granted, not all of that $95 is extra share price (since some of this growth is already factored in to today's stock price), but surely, the price target should be higher than the upper $100s?
These are ridiculously optimistic forecasts.
And yet they'll meet these ambitious expectations and all that without cheating anyone... Apple marketing people have a lot of secrets to tell...
Unbelievable. They sell very ordinary phone (when it comes to almost everything except excellent web browsing capabilities). App Store is stuffed with limited simplistic applications. Carriers' infrastructure can't stand the shot.
And yet they'll meet these ambitious expectations and all that without cheating anyone... Apple marketing people have a lot of secrets to tell...
You really don't get the iPhone, do you?
You really don't get the iPhone, do you?
MB489NF. 7A400.
MB489NF. 7A400.
Still don't really get it
the jitterbug is for you
I don't believe these forecasts for one second. Moreover, if these analysts really believed their own sales projections, they should be setting a much higher price target for Apple.
Let me explain.
Assume 80M iPhones sold in 2012 at an average price of $500 per phone => $40B in iPhone revenues. If Apple gets its average 15% profit margin (a very conservative assumption, since iPhone margins are higher the company's average), that is $6B in iPhone profits by 2010. At a P/E of 20, that's worth $120B in market cap. Discounted back to mid-2009 at a cost of equity of 15%, the present value is $85B today. With approximately 900M shares outstanding, that is ~$95 per share in Apple stock price from just in its iPhone line of business! Granted, not all of that $95 is extra share price (since some of this growth is already factored in to today's stock price), but surely, the price target should be higher than the upper $100s?
These are ridiculously optimistic forecasts.
Optimistic or pessimistic?
First, target prices are typically for the next 12 months, so if they don't say otherwise this is my assumption, and the sales figures they are forecasting are over that horizon. Second, RBC does indeed set a target price over $200, at $250. You're never going to get 100% satisfaction or consistency out of numbers presented by analysts, since at best they are guesstimating, but I don't think they are wildly inconsistent either.
The exciting part for AAPL stockholder is that the iPhone is potentially a huge driver of growth over the next couple of years, rivaling if not bettering the revenue growth generated by the iPod over the past few years. I keep itching to sell some of my AAPL... but then I see forecasts like this, and find I can't seem to loosen my grip.
Does that mean it's going to happen? Of course not. You pays your money and you takes your chances.
Still don't really get it
the jitterbug is for you
ooooh. low blow!
i think some people (maybe including ivan) don't understand what the iphone has done for people that don't want to study a manual for a week before they use their phone. yes, there are other phones that do everything the iphone does, there are certainly phones that have more ticks on a feature list. but how many of them are a joy to use?
that's what sets apple apart. attributing the iphone's success solely to apple's marketing is just trolling...
Still don't really get it
the jitterbug is for you
Oh no you didn't!
http://www.ctv.ca/servlet/ArticleNew...18?hub=SciTech
Guess a lot of you didn't see this:
http://www.ctv.ca/servlet/ArticleNew...18?hub=SciTech
The sheer demand for this product is pretty crazy.
Too bad we're all going to die in 2012...
But at least we will all die with an iPhone in our hand!
Let's just hope it's a Verizon iPhone
I'm gonna make a picture of another big flag. You did want it, you, guys..
They'll all "explode" muhahahaaa
Only yours will explode.
I don't believe these forecasts for one second. Moreover, if these analysts really believed their own sales projections, they should be setting a much higher price target for Apple.
Let me explain.
Assume 80M iPhones sold in 2012 at an average price of $500 per phone => $40B in iPhone revenues. If Apple gets its average 15% profit margin (a very conservative assumption, since iPhone margins are higher the company's average), that is $6B in iPhone profits by 2010. At a P/E of 20, that's worth $120B in market cap. Discounted back to mid-2009 at a cost of equity of 15%, the present value is $85B today. With approximately 900M shares outstanding, that is ~$95 per share in Apple stock price from just in its iPhone line of business! Granted, not all of that $95 is extra share price (since some of this growth is already factored in to today's stock price), but surely, the price target should be higher than the upper $100s?
These are ridiculously optimistic forecasts.
The analysts' logic is actually very sound with regard to how the iPhone grows so large by 2012. However, your contention that a much higher share price would result from those predictions is also very sound. And so you justly point out that the analysts' iPhone sales predictions and share price targets are completely out of whack. You should stop right there, but you don't.
Your conclusion is that the analysts iPhone sales predictions are ridiculously high.
My conclusion is that the analysts' share price targets are ridiculously low.
Given the history of the analysts', it seems likely that they are still under-appreciating the high margins on the heavily subsidized iPhone because the deferred revenue is still shielding the earnings from clear view. It won't be too much longer before the deferred revenue wave build into an earnings tsunami, and when that happens (and it becomes clear to every Tom, Dick, & Harry) you are going to see a massive growth in P/E to "catch the wave". So, the share price will simultaneously get a boost from sudden earnings growth as well as P/E inflation.
Ultimately, the proper conclusion is that the AAPL share price will be much higher in 2012, a sure multi-bagger, IMNSHO (in my not so humble opinion). In other words, buy AAPL before it's too late.
Thompson