Most AT&T stores expecting less than 40 iPhones at launch

Posted:
in iPod + iTunes + AppleTV edited January 2014
WR Hambrecht & Co. on Wednesday raised its price target on shares of Apple Inc, citing falling component prices during the current quarter and pent-up demand for iPhone leading into next month's launch.



The firm surveyed a number of Cingular/AT&T stores to get a feel for potential retail demand as well as expected availability and found that most locations are still in the dark as to when they will receive initial shipments of the inaugural Apple handset.



"[Our] results indicate that the stores do not have reliable color on the timing of when they will have the phone; most stores expect the phone on June 15th or June 22nd, and most expect to only have a few (highest number was 40 at one store) on hand initially," analyst Matthew Kather wrote in a report.



The analyst added that overall pent-up retail demand appears very strong, with about 15-20 percent of the stores that were contacted saying they are keeping a waiting list for customers interested in purchasing the device.



Shares of Apple may begin to see increased activity a couple of weeks ahead of the iPhone launch, according to Kather, who notes the company's Worldwide Developers Conference is set to tip-off during the week of June 11th.



"We expect Apple to unveil an update to its Mac franchise, specifically on the professional lines, which could include new features like instant boot given the new technology from Intel's Centrino platform," he wrote. "The could be a number of other software related announcements too around the Mac platform, and possibly the iPhone/Apple TV."



Kather, who maintains a Buy rating on shares of the Cupertino-based Apple, raised his target to $125 per share from $115 per share, while also increasing his estimates for the company's June quarter on sliding component prices.



Specifically, the analyst cited "falling to stable" component prices on a sequential basis for DRAM and NAND flash, which should drive gross margins to 33.5 percent, up from his previous estimate of 32.5 percent and Apple's guidance of 32 percent.



"Component prices will not be as big of a tailwind as in the [first calendar quarter of the year], in our opinion, but with DRAM on track to decline about 40 - 50 percent and NAND prices mostly slightly up to flat quarter-over-quarter, it should still flow through to very strong gross margins for the June quarter," he explained. "Additionally, we believe the upcoming iPhone launch will be a catalyst for modest multiple expansion in the stock price due to the planned deferred revenue recognition of iPhone sales."
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Comments

  • Reply 1 of 33
    anantksundaramanantksundaram Posts: 19,387member
    Sheesh..... I am now REALLY getting bummed about the AAPL calls I had sold at $120 (not so much because of this analyst, as much as watching the ticker getting steadily close to the exercise price these past few weeks).

  • Reply 2 of 33
    aplnubaplnub Posts: 2,591member
    Well, I bought in long at $113. I have been watching it for the past two years. What was I thinking?
  • Reply 3 of 33
    nagrommenagromme Posts: 2,834member
    A survey of stores who have no clue, to see what each one "expects"?



    If they really knew, they'd know not to say. I don't think that number is reliable info. The stores admit they don't know the date... yet they guess a date all the same. They're guessing on quantities too I'm sure.



    Anyway, say it's half that, 20 phones, times 2000 stores, that's 40 thousand to start with (plus online sales from AT&T and Apple) and more on the way.
  • Reply 4 of 33
    andrewcodandrewcod Posts: 19member
  • Reply 5 of 33
    petermacpetermac Posts: 115member
    Hmmm, 40 phones per store wont do They'll be gone by 9 AM. I wonder how many will be in the Apple Stores?
  • Reply 6 of 33
    melgrossmelgross Posts: 31,907member
    Quote:
    Originally Posted by nagromme View Post


    A survey of stores who have no clue, to see what each one "expects"?



    If they really knew, they'd know not to say. I don't think that number is reliable info. The stores admit they don't know the date... yet they guess a date all the same. They're guessing on quantities too I'm sure.



    Anyway, say it's half that, 20 phones, times 2000 stores, that's 40 thousand to start with (plus online sales from AT&T and Apple) and more on the way.



    That's not much.



    I wonder how many Apple will be reserving for its stores and website?
  • Reply 7 of 33
    bderwestbderwest Posts: 36member
    Quote:
    Originally Posted by petermac View Post


    Hmmm, 40 phones per store wont do They'll be gone by 9 AM. I wonder how many will be in the Apple Stores?



    I wonder if the podunk, backwoods AT&T store here in Hanover, Pa., will get ANY. Seriously. Which stores, AT&T, WHICH STORES?? I don't want to be wasting my time waiting in line at the store that won't have any phones when I can be driving to Towson, Md., to the nearest Apple Store.



    Blargh
  • Reply 8 of 33
    restalotrestalot Posts: 77member
    I would bet my three-cornered-hat on the Apple stores having 10x+ the quantity of the AT&T stores... it wouldn't be the first time Apple screwed a retail partner to benifit themselves...
  • Reply 9 of 33
    whoamiwhoami Posts: 301member
    can you say PS3 all over again? people getting shot for iphone!

    campouts at at&t and apple... had to know this was coming.
  • Reply 10 of 33
    rot'napplerot'napple Posts: 1,839member
    Quote:
    Originally Posted by petermac View Post


    Hmmm, 40 phones per store wont do They'll be gone by 9 AM.



    Then I guess Apple will have to ship some more after 9 AM...
  • Reply 11 of 33
    rot'napplerot'napple Posts: 1,839member
    Quote:
    Originally Posted by Restalot View Post


    I would bet my three-cornered-hat on the Apple stores having 10x+ the quantity of the AT&T stores... it wouldn't be the first time Apple screwed a retail partner to benifit themselves...



    that's a given...
  • Reply 12 of 33
    rot'napplerot'napple Posts: 1,839member
    Quote:
    Originally Posted by whoami View Post


    can you say PS3 all over again? people getting shot for iphone!

    campouts at at&t and apple... had to know this was coming.



    can't campout at my apple store inside a mall that closes at 10 pm and everyone is cleared out by security, though not sure about the attached parking garage???
  • Reply 13 of 33
    you guy shave to be kidding me. 40 phones? and you think they will sell out? people need to sign 2 year agreements to cingular, if you already have a contract with verizon or anyone else, you aren't going to end that contract with them and pay that 200 bucks on top of the 500 for the phone. This launch will not be like a game system. buying a ps3 didn't mean you couldn't buy an xbox, and you didn't have to have your ps2 for 2 years before you bought a ps3.



    this is a different product, different market, and for every person that goes in with 600 in hand ready to buy the phone and sign up for two more years of cingular, there will be 200 people who walk in wanting the iphone until they see that they can get faster speed and an actual keyboard for 200 bucks.



    This phone will not be the product a lot of people think it will. I would like to buy it, but I'm not camping out for it, I'll wait for reviews, handle it in store and make an intelligent decision on whether it's worth 500 bucks, not blindly go in a store and plop down 500 of my hard earned dollars just because it has an apple logo on it.
  • Reply 14 of 33
    melgrossmelgross Posts: 31,907member
    Quote:
    Originally Posted by chadisawesome View Post


    you guy shave to be kidding me. 40 phones? and you think they will sell out? people need to sign 2 year agreements to cingular, if you already have a contract with verizon or anyone else, you aren't going to end that contract with them and pay that 200 bucks on top of the 500 for the phone. This launch will not be like a game system. buying a ps3 didn't mean you couldn't buy an xbox, and you didn't have to have your ps2 for 2 years before you bought a ps3.



    this is a different product, different market, and for every person that goes in with 600 in hand ready to buy the phone and sign up for two more years of cingular, there will be 200 people who walk in wanting the iphone until they see that they can get faster speed and an actual keyboard for 200 bucks.



    This phone will not be the product a lot of people think it will. I would like to buy it, but I'm not camping out for it, I'll wait for reviews, handle it in store and make an intelligent decision on whether it's worth 500 bucks, not blindly go in a store and plop down 500 of my hard earned dollars just because it has an apple logo on it.



    Yup! 40 phones will sell out real quickly.



    Even if you were right, they would sell out quickly. 40 phones is nothing for a product like this. If the number was 500 per store, then I would agree that it would take a bit of time, but not 40.
  • Reply 15 of 33
    desarcdesarc Posts: 642member
    "with about 15-20 percent of the stores that were contacted saying they are keeping a waiting list for customers interested in purchasing the device."



    ...so much for apple demanding that reservations will not be allowed.
  • Reply 16 of 33
    porchlandporchland Posts: 478member
    Quote:
    Originally Posted by whoami View Post


    can you say PS3 all over again? people getting shot for iphone!

    campouts at at&t and apple... had to know this was coming.



    Don't underestimate the Cabbage Patch effect. The news coverage the entire day will be about the enormous demand of the iPhone, lines out the door, stores running out in the first hour, etc.



    It's like the Zune launch all over again!!
  • Reply 17 of 33
    if an average cellphone sale takes 30 minutes and the average cell phone store is open 12 hours, and with 2 sales people making constant sales all day, that's only 48 phones TOTAL in a day.



    taking into consideration that 90% of those phones are freebies, and 10% or less are smartphones, you are talking about MAYBE 5 smartphones around 200 - 300 bucks selling per day per store, and I believe that to be a high estimate.



    Now you are looking at a device that is double the normal smartphone price... the customer gets no money off, no mail in rebates, no pat on the back, nothing for purchasing and singing this 2 year agreement, and you think that 40 will sell by 9am?



    This isn't something you walk in, say I want, pay and leave. they need to look up your account, see if you are eligible for an upgrade, have you sign paperwork.. make sure you have the sim card that is better suited for data, try to sell you on upgrades to your account, make you think you need that more expensive data plan... try to sell you the bluetooth headset, and overpriced carcharger and leather case. And don't even get me started if you are a new account switiching from another provider and you want to keep your number. Unless they have 40 sales people on hand (one per phone), this phone will take a long time to sell out.
  • Reply 18 of 33
    jeffdmjeffdm Posts: 12,949member
    Quote:
    Originally Posted by desarc View Post


    "with about 15-20 percent of the stores that were contacted saying they are keeping a waiting list for customers interested in purchasing the device."



    ...so much for apple demanding that reservations will not be allowed.



    The waiting list is probably different, from what I've read, it just puts you on a list of people to call when it comes in, but the phones are still first-come-first-served, you don't get one that's set aside just for you.



    A reservation is basically a down payment to have a phone that's set aside for you to come in when you can and it will still be there for you.
  • Reply 19 of 33
    jcatma61jcatma61 Posts: 37member
    Quote:
    Originally Posted by chadisawesome View Post


    Now you are looking at a device that is double the normal smartphone price... the customer gets no money off, no mail in rebates, no pat on the back, nothing for purchasing and singing this 2 year agreement, and you think that 40 will sell by 9am?



    Not true. The new BlackBerry devices run between $499-$599 among carriers. The out-the-door price for both longtime customers and walk-in, new customers is $2-300. Those up-front "discounts" are a lie; any meaningful voice and data plan with those is going to top $100/mo.



    Chad, We don't know the details. Jim Cramer was said to have confidential information about steep discounts from ATT on service specials and contract buy-outs. We just don't know about those things right now.



    I'm no. 7 on the waiting list in my little town, but I doubt most people know there's a waiting list. Honestly, how many new releases have required one nationwide?



    I was told to expect a call the day they're received, but that ATT is still telling stores the shipments will be sold first-come, first-served.



    Each store has a primary contact on the sales force for iPhone; no details were to be given out about ship date or rate specials. My store contact would only say that the info they're getting is being held close and that they're being told the central warehouse for Chicago area stores will receive shipments "mid-June."



    There was a deep breath and a pregnant pause, however, when I said, "So, I understand those will be available on the 11th?"



    But, ah, we're back to speculation again, aren't we?
  • Reply 20 of 33
    petermacpetermac Posts: 115member
    Quote:
    Originally Posted by chadisawesome View Post


    if an average cellphone sale takes 30 minutes and the average cell phone store is open 12 hours, and with 2 sales people making constant sales all day, that's only 48 phones TOTAL in a day.



    taking into consideration that 90% of those phones are freebies, and 10% or less are smartphones, you are talking about MAYBE 5 smartphones around 200 - 300 bucks selling per day per store, and I believe that to be a high estimate.



    Now you are looking at a device that is double the normal smartphone price... the customer gets no money off, no mail in rebates, no pat on the back, nothing for purchasing and singing this 2 year agreement, and you think that 40 will sell by 9am?



    This isn't something you walk in, say I want, pay and leave. they need to look up your account, see if you are eligible for an upgrade, have you sign paperwork.. make sure you have the sim card that is better suited for data, try to sell you on upgrades to your account, make you think you need that more expensive data plan... try to sell you the bluetooth headset, and overpriced carcharger and leather case. And don't even get me started if you are a new account switiching from another provider and you want to keep your number. Unless they have 40 sales people on hand (one per phone), this phone will take a long time to sell out.



    Practical observations, chadisawesome. I suppose what I am also saying is that there will be lineups for these things for several hours, if not all day, You are right, my last handset/plan upgrade took all of 8-10 mins, but the bluetooth headset the sales clerk then foisted upon me took another 10 mins to consumate. If I was just upgrading the handset, I could have been out in 10 mins. Then again, I also had to wait 10 mins to see the sales clerk in the first place. sigh
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