Neil Hughes
At Apple's September media event, the iPhone maker suggested roughly 3.5 million phones were sold in the quarter with three weeks remaining, Yair Reiner, analyst with Oppenheimer, said in a note to investors Friday. But some analysts believe Apple will have sold more than twice that in the September quarter. While recent surveys suggest the supply issue has been mostly resolved, Reiner believes that bottleneck period could lead to slight disappointment in the company's fourth-quarter fiscal year revenue.
But outstanding demand for the iPhone has an upside for the holiday season, provided Apple can keep up with demand. Reiner recommended that investors "keep some powder dry" to buy shares after Apple reports its earnings Monday afternoon, rather than before.
"With demand for the iPhone apparently outstripping supply, December could be a substantial catch-up quarter, both in terms of sell-through and channel replenishment," he said. "Barring any additional component or manufacturing disruptions, we believe our 8M unit assumption for F1Q10 could prove conserfative, especially given the iPhone's expanding carrier footprint."
Apple's iPhone supply issues were also noted Thursday by Piper Jaffray analyst Gene Munster. The handset maker has had trouble keeping the iPhone 3GS in stock, in particular. Overseas, wireless carrier 3 Italia has said though it is selling 20,000 iPhones per month, it could double those numbers if the supply were available.
Like others, Reiner expects a record quarter for Mac sales, with Apple shipping between 2.7 million and 2.8 million units. But the potential to exceed those numbers, he said, is limited, because rumors of new MacBooks and iMacs likely delayed some purchases. Reiner expects the company's first quarter of the 2010 fiscal year to be "significantly more impressive" than the concluded September quarter.
Previously, Oppenheimer predicted that new accounting rules from the Financial Accounting Standards Board would boost Apple's shares as iPhone revenue is realized up-front. In that report, Reiner predicted that Apple would continue to "surprise to the upside" for investors.
Given the strong future potential, Reiner has maintained his outperform rating for Apple despite iPhone supply concerns. Oppenheimer has a price target of $210 for AAPL stock.
Christine McKee
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49 Comments
Amazing this 3GS is. Apple couldn't keep up with the demand with its 3GS supply. I know I love mine and I have recommended it to 2 newbees that also bought in. My friends with their 3G phones want them too. Just goes to show you to give the people what they want and they will buy in droves- Video, better camera, faster speed and better battery, more storage, and yes MMS. And of course the App store keeps on growing.
Amazing this 3GS is. Apple couldn't keep up with the demand with its 3GS supply. I know I love mine and I have recommended it to 2 newbees that also bought in. My friends with their 3G phones want them too. Just goes to show you to give the people what they want and they will buy in droves- Video, better camera, faster speed and better battery, more storage, and yes MMS. And of course the App store keeps on growing.
And if you could actually freely tether your Internet connection it would be perfect
Oh look, surprise surprise, and we are pretty much back where we started, so much for all you doom mongers who predicted aapl would never recover..
And if you could actually freely tether your Internet connection it would be perfect
I know , I know - just not trying to go there so early in the morning. Besides that's more of an AT&T thing- elsewhere has it already.
It is hard to understand who would be disappointed by selling a product faster than it can be manufactured. Apples manufacturing process has historically been superior to there competition, so no issues there. Apple will almost certainly beat estimates across the board. The new accounting rules are the big wild card. I am looking forward to seeing the effect of that change. Will apple bring all deferred revenue into this qtr or will/can they hold some back as backlog? These are the unknowns that I would focus on. As a manufacturer myself I would love to be in the position of not being able to keep up with demand, it is by far better than the alternative.