Apple's third fiscal quarter iPhone sales came in above expectations at 31.2 million units, although many of those were the lower priced iPhone 4. Canaccord Genuity analyst Michael Walkley says that supports the idea that Apple needs a fresh iPhone model that costs less than the iPhone 5, and he thinks that will come this fall.
Mr. Walkley said,
Apple reported iPhone unit sales well above consensus estimates with lower ASPs. We believe the strong demand for the more affordable iPhone 4 demonstrates the sizable TAM potential for a new lower-priced iPhone SKU likely to launch later this year. We maintain our belief that Apple has a strong product pipeline, including a refreshed iPhone 5S, mid-tier iPhone, and iPad lineup that should result in solid earnings growth during fiscal 2014.
Apple has been rumored to be working on a lower priced iPhone model as part of a plan to move away from its current system where previous iPhone models stay on the market at a discount. Should the rumored mid-range iPhone actually exist, a fall launch makes sense.
Apple has announced that iOS 7 is coming this fall, and the beta is already in developer's hands. Launching new iPhone and iPad models at the same time would make sense because Apple no doubt wants the latest version of iOS on its newest devices -- and this is something the company has done with other iPhone launches, too.
If Apple does release the iPhone 5's replacement when iOS 7 ships, introducing a less expensive model at the same time would be easy to do, and would ride nicely on the hype of the iPhone 5S and iOS rollout.
Wells Fargo analyst Maynard Um is on board with a fall iPhone launch, too, and he even thinks he knows the date: September 27. He speculated that Apple's confirmation of a fall product launch fits the date because it's around the same time previous iPhone models have gone on sale, iPhone launches are often on Fridays, and it will have technically been fall for several days.
The September 27 date would also give Apple a couple days of new iPhone sales in the current quarter, get inventory on store shelves in time for the holiday buying season, and would be late enough in the year to keep competitors from reacting in time for those holiday sales.
Assuming Mr. Walkley and Um are right -- and that's seeming more likely -- then we should be seeing two new iPhones come September.
Mr. Walkley is maintaining his "Buy" rating and US$530 target price for Apple's stock. Apple is currently trading in the pre-market at $441.26, up 0.75 (0.17%).