iPhone 4 sales 'surprisingly robust' ahead of Apple's iPhone 5 debut
More evidence of continuing strong iPhone 4 sales surfaced in a new report on Friday, in which Apple's supply chain has indicated consumer demand for the more-than-a-year-old smartphone remains despite an anticipated fifth-generation iPhone announcement.
Analyst Shaw Wu with Sterne Agee said in his latest note to investors that checks with Apple's global supply chain found "surprisingly robust" demand for the iPhone 4. The details echo a separate report from earlier this week that revealed the iPhone 4 is still the top-selling U.S. smartphone, despite being more than a year old.
"The reason why this is remarkable is demand for iPhone 4 remains fairly robust despite it being well known that there will be an upcoming iPhone 5 refresh," he wrote.
Wu had previously modeled for a sizable quarter-over-quarter decline in iPhone shipments to reflect inventory drawdown ahead of an anticipated fifth-generation iPhone update. But the analyst said he now believes his original estimate of 15.7 million iPhone sales for the quarter is conservative.
Accordingly, Wu has updated his forecast, and now expects Apple to sell 18.5 million iPhones in the September quarter, which concludes in about three weeks. That number is still less than the record 20.34 million iPhones the company sold last quarter, but less steep of a drop than his original prediction.
Wu also revealed that supply chain sources have allegedly said that volume production of the next-generation iPhone model is expected to begin in the mid-to-late September timeframe. Aligning with most rumors of late, sources in Apple's supply chain expect the next iPhone to be introduced in October.
In addition to strong sales of the iPhone 4, supply chain sources were also said to have noted that iPad production is higher than expected. Apple is said to have been able to produce more units because of a "much improved" production capacity, Wu said.
Apple reportedly added an additional panel supplier for production of iPad 2 units. Previously, this component proved to be a "key capacity constraint," he said.
Wu now expects Apple to sell 12 million iPads in the September quarter. Like the latest iPhone estimate, that's also an increase, up from a previous forecast of 10.4 million units.
With estimated Mac sales the same at 4.1 million units, Wu expects Apple to have a slightly higher gross margin of 41 percent, up from 39 percent, due to a favorable product mix toward the iPhone and improved iPad profitability. Sterne Agee has reiterated its "buy" rating for AAPL stock with a price target of $500.
Analyst Shaw Wu with Sterne Agee said in his latest note to investors that checks with Apple's global supply chain found "surprisingly robust" demand for the iPhone 4. The details echo a separate report from earlier this week that revealed the iPhone 4 is still the top-selling U.S. smartphone, despite being more than a year old.
"The reason why this is remarkable is demand for iPhone 4 remains fairly robust despite it being well known that there will be an upcoming iPhone 5 refresh," he wrote.
Wu had previously modeled for a sizable quarter-over-quarter decline in iPhone shipments to reflect inventory drawdown ahead of an anticipated fifth-generation iPhone update. But the analyst said he now believes his original estimate of 15.7 million iPhone sales for the quarter is conservative.
Accordingly, Wu has updated his forecast, and now expects Apple to sell 18.5 million iPhones in the September quarter, which concludes in about three weeks. That number is still less than the record 20.34 million iPhones the company sold last quarter, but less steep of a drop than his original prediction.
Wu also revealed that supply chain sources have allegedly said that volume production of the next-generation iPhone model is expected to begin in the mid-to-late September timeframe. Aligning with most rumors of late, sources in Apple's supply chain expect the next iPhone to be introduced in October.
In addition to strong sales of the iPhone 4, supply chain sources were also said to have noted that iPad production is higher than expected. Apple is said to have been able to produce more units because of a "much improved" production capacity, Wu said.
Apple reportedly added an additional panel supplier for production of iPad 2 units. Previously, this component proved to be a "key capacity constraint," he said.
Wu now expects Apple to sell 12 million iPads in the September quarter. Like the latest iPhone estimate, that's also an increase, up from a previous forecast of 10.4 million units.
With estimated Mac sales the same at 4.1 million units, Wu expects Apple to have a slightly higher gross margin of 41 percent, up from 39 percent, due to a favorable product mix toward the iPhone and improved iPad profitability. Sterne Agee has reiterated its "buy" rating for AAPL stock with a price target of $500.
Comments
14 months later, I'm still pretty happy with mine
Of course, when I see the iPhone 5, I'll be wanting to throw my iPhone 4 in the trash
Why would that be surprising? The iPhone 4 is the best Phone you can get until the iPhone 5 debuts.
Fixed...
Apple sold more iPhones (20 million) last quarter than any other previous quarter although the upcoming fifth-generation unit is on the horizon.
Why is it surprising? The second best selling smartphone in the U.S. is the iPhone 3GS, a design that has been rolling off of the manufacturing line for fifteen months.
I think you meant 27 months (and the body shell of the 3GS is 39 months old).
Why would that be surprising? The iPhone 4 is the best Apple iPhone you can get until the iPhone 5 debuts.
If Apple comes up with tear drop plastic iPhone 5, I would rather stick with the iPhone 4. I like the precision that was involved in its fab.. plus the Stainless Steel, Gorilla Glass case. It is a work of art.
If Apple comes up with tear drop plastic iPhone 5, I would rather stick with the iPhone 4. I like the precision that was involved in its fab.. plus the Stainless Steel, Gorilla Glass case. It is a work of art.
Enough said.
Not sure if there is a new design Apple can put out that I like more than the IPhone 4.
I'm hoping apple does more refining of the iPhone 4 design, and a boost in features and specs. Because when they do come out with a different design, I can still get a better phone and keep the iPhone look and feel.
If Apple comes up with tear drop plastic iPhone 5, I would rather stick with the iPhone 4. I like the precision that was involved in its fab.. plus the Stainless Steel, Gorilla Glass case. It is a work of art.
Indeed. It is a work of art. As Steve said, "...like a fine Leica camera."
Honestly, I don't know how Apple can improve on the design. I hope the iPhone 5 does not turn people off.
Apple sold more iPhones (20 million) last quarter than any other previous quarter although the upcoming fifth-generation unit is on the horizon.
It's pretty staggering. I know the Kinect has been rated the fastest selling gadget but in what time frame do they measure? I think it' more impressive that a year old smartphone can still be increasing in sales when new devices with much newer HW keep flooding the market.
Why is it surprising? The second best selling smartphone in the U.S. is the iPhone 3GS, a design that has been rolling off of the manufacturing line for fifteen months.
I think you meant 27 months (and the body shell of the 3GS is 39 months old).
I just wanted to point this out.
If Apple comes up with tear drop plastic iPhone 5, I would rather stick with the iPhone 4. I like the precision that was involved in its fab.. plus the Stainless Steel, Gorilla Glass case. It is a work of art.
I think the precision will be as good or better than the current model. I can't see them moving to a plastic mold again.
In my experience with others buying an iPhone, many people don't have a clue that models are refreshed every year - and don't care. They just know that Apple sells the iPhone and that they want one. Only geeks like us cringe at the thought of buying last year's model just before a refresh.
very good point.
and Apple will very likely keep making the iPhone 4 to sell as a lower priced version alongside the iPhone 5. just like they have done this last 1.5 years with the 3GS that will now finally be discontinued.
most importantly, the iPhone 4 will get the iOS 5 update too. so the iPhone 5 will only feature various various hardware upgrades compared to the iPhone 4.
like most folks, i'm on a 2 year contract and upgrade cycle. so trading my 3GS (which replaced my original 2G) for a 5 will be a big upgrade. but i wouldn't bother if i had a 4. then i suppose i'll skip the 6 and wait for the 7. or maybe Apple will stretch its hardware cycles out to two years anyway, but still with annual iOS updates. the hardware is pretty mature by now with iPhone 5 - what's left? it's the software that keeps innovating.
Well Apple did announce new stuff in June but it wasn't a new iPhone but a great new service (iCloud) and the best iOS update so far that all iPhone 4 owners will get for free.
I just want to find these pundits and .... http://www.youtube.com/watch?v=n8riJCf-qvM
I'd rather trust Apple's marketing over anybody's advise. There is an inherent honesty and about Apple and the post-sale support you get proves it. The iPhone sales are just a proof of that.
The general public is clueless as to when Apple will release new hardware, I.E. they don't check Apple rumors sites like we do. I know people who bought the iPad back in February right before the iPad 2 and I couldn't believe how uniformed they were.
Wow. How's the view from up there on that high horse?
People are perfectly informed, but they don't put as much gravity in having the latest-and-greatest as tech geeks do. It just doesn't matter. They have other things to do in life and don't care if it's iPhone 4 or iPhone 5 or whatever. It just doesn't matter. If they like what they see in an ad, then that's what they want. My wife wants an iPhone 4 (after nearly 2 years of suffering with a Droid Eris) and I'm the one holding her back. She was vaguely aware of the iPhone 5 coming but doesn't care.
See, outside the geek-o-sphere, people aren't that concerned about specs and what's coming around the corner with any given gadget. It's important to techies, but nobody else. It's not a matter of being uninformed, but a matter of priorities. For example, I don't much care about cars. You could tell me Honda is going to have a new model of car out 3 months from now, but if I want a new car, I'm buying the one I like today. Who would wait?
I think you meant 27 months (and the body shell of the 3GS is 39 months old).
Yes, yes, the iPhone 3GS guts are 27 months old. Too much coffee, I guess!
Wow. How's the view from up there on that high horse?
People are perfectly informed, but they don't put as much gravity in having the latest-and-greatest as tech geeks do. It just doesn't matter. They have other things to do in life and don't care if it's iPhone 4 or iPhone 5 or whatever. It just doesn't matter. If they like what they see in an ad, then that's what they want. My wife wants an iPhone 4 (after nearly 2 years of suffering with a Droid Eris) and I'm the one holding her back. She was vaguely aware of the iPhone 5 coming but doesn't care.
See, outside the geek-o-sphere, people aren't that concerned about specs and what's coming around the corner with any given gadget. It's important to techies, but nobody else. It's not a matter of being uninformed, but a matter of priorities. For example, I don't much care about cars. You could tell me Honda is going to have a new model of car out 3 months from now, but if I want a new car, I'm buying the one I like today. Who would wait?
Finally, a voice of reason in all the stupidity. I once was showing someone the differences between the original iPhone and the iPhone 4, and their reaction was 'they look pretty much the same, and I won't use all that extra stuff anyway. I predict that the most common reaction of most people. For us, the differences between generations of iPhones/iPads/whatever are stratospheric- for normal people, they're hardly noticeable, and often insignificant and and even irrelevant. For the VAST majority of people out there, the iPhone 4 has all they will ever want/need, and more. The iPhone 4 is currently being sold for $99 on contract- you think this isnt going to affect sales? It's huge. If someone asks me for advice before buying one, I'll tell them that yes, a new one will be released soon, but to just go ahead and buy it if they want. I would never convince someone to wait months for a newer version, especially since it will cost more money and probably be near impossible to get initially.
The iPhone 5 will be launching on ALL major carriers in the US, and more internationally. Interest in Apple and their brand awareness has never been higher. That, coupled with the timing of this year's launch in the fall, a couple moths before Christmas will mean that iPhone 5 will probably be in short supply at LEAST into 2012. The demand is going to be monstrous, and no matter Apple's capabilities, they will not be able to meet it. I predict the expected 'Is Apple artificially limiting supply' threads already, as idiotic as that statement is, from anyone who cant get their hands on one. When a company is selling 20 million of an 18 month old phone per quarter, more than any other phone on the planet, is answer is clearly 'no, the demand is just that great. If Tim Cook called the iPad 2 'the mother of all backlogs' I have a feeling that will pale in comparison to the iPhone 5 situation.
PS- For all those that bitched about the iPhone 5 being delayed, its clear now that it was absolutely the right move. When your product is selling 20+million/quarter, you don't release a replacement. I'd bet they could even float on the iPhone 4 for another couple years, thats how far ahead they are in terms of mindshare.
Finally, a voice of reason in all the stupidity. I once was showing someone the differences between the original iPhone and the iPhone 4, and their reaction was 'they look pretty much the same, and I won't use all that extra stuff anyway.
That's exactly what my wife says when I tell her she needs to wait for the iPhone 5. She asks why and I explain what the rumors say it will have and she shrugs and says she wouldn't need those features anyway. And, much to my surprise, she even counters with "Won't the iPhone 4 be even cheaper when the iPhone 5 comes out? I might just get the iPhone 4 regardless."
Having the newest and shiniest really doesn't matter to most people.
This is very normal because the iPhone 5 is ugly and I don't like it
So? you've seen it? Pray tell, what does it look like?