Analyst Charlie Wolf with Needham & Company issued a new note to investors on Tuesday entitled "AAPL: Shock and Awe!" In it, Wolf reveals he has increased his projected iPad sales for 2011 by 10 million, to a total of 30 million.
Wolf has also increased his prediction for 2012 iPad sales by 10 million, totaling 40 million next year. These changes amount to an earnings per share estimate increase of $1 in 2011 to $23.25, while he sees Apple earning $27.35 EPS in 2012.
"Attempting to forecast the growth trajectory of a new category of computers is difficult, if not perilous," Wolf wrote. "However, the launch of the iPad 2 so far exceeded our expectations that it was evident our 2011 and 2012 shipment forecasts were dramatically low."
He said that hopeful competitors to the iPad have missed the point: the device's success is tied to its software, not the hardware. But competing devices, like those running Android Honeycomb, don't offer enough applications to entice most users.
"In our view, Android's problems go beyond the dearth of applications," he said. "The Honeycomb interface itself appears overly complex for the purpose it was intended — an intuitive, easy-to-use platform for running applications written for Android."
Wolf noted that there is a "robust gray market" for the iPad 2, as lines for the device continue to form across the U.S. He sees this as a sign that the biggest opportunity for Apple with the iPad may be in China.
Lending support to Wolf's conclusions regarding the gray market, AppleInsider reader Noah sent details and video on Tuesday from the iPad 2 line at Apple's New York City retail store in SoHo. The line of customers reportedly wrapped around Prince Street, north on Greene Street and almost to Houston, while most who were waiting were said to be speaking mostly Mandarin and some Cantonese.
"Ten or so minutes after they allowed the line in, we were told that all of the AT&T versions were sold out," he said in an e-mail. "Some people left grumbling (me included). Ten minutes from them, the same went for all Wifi models. Only Verizon's versions remain."
Apple experienced crushing demand for the iPad 2 at launch in the U.S., and last week's international launch saw similar sellouts across the globe. But there have been signs that availability is improving, with shorter estimated shipping times from Apple's online store, and expanded retail availability at Radio Shack stores starting today.
134 Comments
I wasn't impressed with the web-browsing speed of the iPad 1, so I never bought one.
However, now that the thing is snappier, I'd be willing to buy one.
I joined the rest of you in the ranks of the waiting list. I ordered a white 16GB model for my retired parents, who will love using the camera connector. I envision them getting back back to the car from a bird-watching or lighthouse-seeking trip, plugging the camera into their iPad, and using it to view the shots they just took on a bigger screen. And they can also use it to email while they're out and about on their weekend jaunts.
If even senior citizens love the iPad....yeah, these things will sell like hotcakes.
... full disclosure.
charlie "shock and awe" wolf:
read the requisite full disclosures on any of his writings.
i, too, own apple stock and want people to buy, buy, buy.
but beware the messenger, he is not unbiased.
... on Tuesday from the iPad 2 line at Apple's New York City retail store in SoHo. The line of customers reportedly wrapped around Prince Street, north on Greene Street and almost to Houston, while most who were waiting were said to be speaking mostly Mandarin and some Cantonese.
My GF & I walked past the SoHo Apple Store on iPad2-Day. We were both a surprised that at least 75% of the people in line were Chinese... and it DID wrap around the block. We thought it was a bit weird, since most of the tourists in SoHo are plump middle-Americans.
Analysts who increase their estimated iPad shipments based on demand are clueless. Apple will sell 100% of what they make short of a manufacturing miracle. The sole determiner of iPads shipped in 2011 is how many iPads Apple can manufacture in 2011. If they have any observations on supply chains, increased build efficiency, or improved processes, THAT could lead to an increase in 2011 iPad estimates.