25-September-2013 Apple’s big iPhone ‘beat’ may have gotten boost from unsold 5Cs Apple Inc. blew away most forecasts with its claim to have sold more than 9 million of its newest iPhones over the weekend, but a couple of analysts believe some of that beat may have come from units of the iPhone 5C that are still sitting on other retailers’ shelves. The iPhone 5C and 5S. Apple AAPL said Monday that it sold more than 9 million units of the iPhone 5S and 5C models over the three days since the devices went on sale on Friday, adding that the iPhone 5S is now sold out. It did not break down how many units of each version were sold, nor did it specify how many were sold through its own stores and Web site, compared to how many were sold through other channels, which included large retailers as well as stores operated by the wireless carriers offering the device. At least two analysts have estimated that part of the big beat came from units of the iPhone 5C that have been shipped to other retailers – but not necessarily sold through to customers. Gene Munster of Piper Jaffray wrote on Monday that he believes about 3.5 million units of the iPhone 5C represent a “sell-in” to other retailers. Apple recognizes a sale when a customer buys a product through its own store and Web site, as well as when it ships a product to a retail partner. Munster noted that all versions of the iPhone 5C remain available on Apple’s Web site to ship within 24 hours of order. “We believe this implies that the company has near-full channel inventory of the 5C,” he wrote. “Based on the 11 million total iPhones available in channel inventory as of the June quarter, we believe this implies that 5C could be 3-4 million units.” Peter Misek of Jefferies & Co. wrote on Tuesday that he believes about 2.5 million iPhone 5C units have been sold in to inventory at other retailers, adding that sales through retail partners still comprise “the vast majority” of Apple’s revenues, despite its own growing base of Apple stores. It’s worth noting here that Munster and Misek have somewhat divergent views on Apple. Munster rates the stock as overweight with a $640 price target. Misek is neutral on the shares with a $425 price target. Apple itself did not immediately respond to a request for comment. Toni Sacconaghi of Bernstein did not broach the question of unsold iPhone 5C inventory, but did note on Monday afternoon that “the 5C appears to continue to be (uncharacteristically) widely available, suggesting that Apple may have been overzealous in estimating its appeal.” Investors may have to wait for Apple’s next earnings report in late October for more light on the issue. The company typically discloses iPhone inventory levels and other metrics in its call that may clear up the matter. UPDATE: Morgan Stanley analyst Katy Huberty, in a note sent Tuesday afternoon, estimated that the launch number included about 2 million units of “iPhone 5c non-Apple retail inventory build.” She retains an overweight rating and $540 price target on the stock.
Posted on: Wed, 25 Sep 2013 06:36:50 +0000
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