Why Apple’s weekend iPhone 5 sales figure should be higher

Mon, Sep 24, 2012


Apple’s announcement that they had sold 5 million iPhone 5’s this past weekend is certainly impressive, but is well below the 6-8million estimate some analysts were initially anticipating. And even though initial iPhone 5 sales are 25% higher than iPhone 4S sales were, shares of Apple have tumbled in early Monday morning trading.

Now that analysts have had some time to digest Apple’s announcement, they’re re-staking their claim as it pertains to iPhone 5 sales estimates.

MacRumors points us to a blurb from ISI Group analyst Brian Marshall who speculates that Apple’s 5 million figure is actually under-representative of what the actual sales figures are due to delayed iPhone shipments.

[R]ecall the 5mil+ iPhone 5 reported sales only takes into consideration: 1) what was sold into partners (e.g., retail outlets, carriers, etc.), 2) sold in AAPL retail stores, and 3) direct to customers only if they signed for the device. Importantly, this doesn’t take into consideration units in delivery direct to customers (i.e., AAPL must have signature of acceptance by customer before it is counted as a sale) and we estimate units in transit could be in the millions currently.

Interesting take on things, and Gene Munster, who got the iPhone expectation ball rolling with his best-scenario sales estimate of 10 million iPhone 5s agrees.

We believe there are two factors that negatively impacted the number. First, our sales expectation assumed that Apple would include all phones pre-ordered online. We believe that this may have been up to 1 million additional units as units pre-ordered after the middle of the first day were projected to be available in October. Second, we noted 1.25 days of Apple Retail inventory compared to 2.5 days during the 4S launch. Our 8 million estimate assumed full weekend availability and the counting of all online pre-orders. We believe that if supply were not a constraint and Apple included all pre-orders, the launch weekend number would have been closer to 7-8 million, assuming ~1 million October pre-order sales and an additional 1-2 million units at retail.

Either way, Apple’s December quarter is poised to be an absolutely blowout quarter that should even trump Apple’s earnings from the December quarter of 2011. During that time frame, Apple posted an all-time record of $46.33 billion in quarterly revenue along with profits of $13.06 billion, another quarterly record.


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