How Many iPhones Did Apple Sell In The March Quarter?

  • Posted: 16 April 2012 09:56 PM #31

    Mercel - 17 April 2012 12:32 AM
    turleymuller - 17 April 2012 12:08 AM

    Good points Mercel-

    1- 35M isn’t a stretch, so I guess if you want to normalize Dec for the extra week, there could be a sequential increase in that case. However, if the extra week generated an extra 2.5M in sales, that would mean sales would be lower by 5M because Dec would be inflated by 2.5M and Mar would have been reduced by 2.5M.

    2- I agree, some Dec demand was pushed into the Mar quarter, so we should see considerable channel fill.  However, I don’t think it will offset the effects of the later launch.

    3- I agree, holiday spending on items such as smartphones is often over-emphasized. But, it does have an effect, especially when the week after Christmas is included. Sequential increases from Q1-Q2 don’t necessarily debunk the notion that iPhone sales benefit from holiday spending. AT&T has seen iPhone activations drop sequentially in every Q1-Q2 period. iPhone sales have increased sequentially, but that’s mainly been due to channel fill, carrier & country expansion, plus the benefit of having the week after Christmas.  And Dec not having iPhone launch and extra week.

    4- I totally agree. If Apple had sold to all current users and new iPhone users in Dec, then March iPhone sales would be effectively zero. That’s obviously not the case. However, December did see a huge number of iPhone upgrades due to the extra 3.5 months to the refresh cycle, creating pent-up demand. Thus, Dec iPhone sales were much higher than they typically would be under past 12M refresh cycles. So past Dec periods didn’t get this benefit which made the Q1-Q2 compare and beat easier.

    I am just saying I don’t believe iPhone sales will exceed 37M for the quarter. I am predicting slightly less than 34M.

    Thanks for your reply.  A few comments:  If 2.5M iPhones produced in the Dec. quarter were booked as sales in Dec., then we may have 2.5M fewer iPhones sold in the March quarter.  I don’t see how that creates a 5M shortage in March (unless I’m misreading your point). 

    My main argument with #4 above is that I believe Apple sold all it could produce.  The unmet demand likely continued through the March quarter.  I also think Apple continued to ramp production as demand supported it, offsetting the impact of iPhones produced and sold in the 14th week of the Dec. quarter.  If you’re suggesting demand and supply reached equilibrium in the March quarter, then we’ll have to let Apple decide that for us next Tuesday. 

    And if Apple sold between 34M - 37M iPhones, I think you’ll agree the EPS # will take care of itself.

    You’re right, It’s not exactly 5M difference. I oversimplified it. The point I was trying to make was that Dec may have got an extra 2.5M phones that March historically would have seen. So Dec is 2.5 higher and March is 2.5 lower.  Which isn’t entirely correct. The periods didn’t go from 13/13 weeks to 14/12 weeks, but rather 14/13.  March is still 13 weeks but ends later because it started later. But, sales in the last week in the quarter are typically much lower than the first week which normally starts after Christmas. 

    Apple certainly sold all it could produce in Dec, as channel inventory barely increased. And, it needs to be increased to a higher level. So channel fill will likely be at least 2M units. I think Apple will report a terrific quarter.

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  • Posted: 16 April 2012 10:24 PM #32

    turleymuller - 17 April 2012 12:56 AM

    Apple certainly sold all it could produce in Dec, as channel inventory barely increased. And, it needs to be increased to a higher level. So channel fill will likely be at least 2M units. I think Apple will report a terrific quarter.

    Mind sharing your EPS # or is that under embargo by PED?

         
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    Posted: 16 April 2012 11:02 PM #33

    Johnny - 17 April 2012 12:43 AM

    FYI, a new change in iPhone commercial strategy…..using celebrities.  Just saw one aired with Zoey actress from the New Girl show…...and there’s also one with Samuel Jackson which you can see on Appleinsider.com.  Neither are on apple’s website yet.

    Using celebrities is nothing new, but it IS new for iOS.

    It stays pretty true to the spirit of the iOS commercials.  We won’t have mass numbers of people leaving iPhone because they don’t like a slight tonal shift in Apple advertising.

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    Posted: 16 April 2012 11:10 PM #34

    Mav - 17 April 2012 02:02 AM
    Johnny - 17 April 2012 12:43 AM

    FYI, a new change in iPhone commercial strategy…..using celebrities.  Just saw one aired with Zoey actress from the New Girl show…...and there’s also one with Samuel Jackson which you can see on Appleinsider.com.  Neither are on apple’s website yet.

    Using celebrities is nothing new, but it IS new for iOS.

    It stays pretty true to the spirit of the iOS commercials.  We won’t have mass numbers of people leaving iPhone because they don’t like a slight tonal shift in Apple advertising.

    Love the new commercials!

         
  • Posted: 16 April 2012 11:49 PM #35

    Mercel - 17 April 2012 01:24 AM
    turleymuller - 17 April 2012 12:56 AM

    Apple certainly sold all it could produce in Dec, as channel inventory barely increased. And, it needs to be increased to a higher level. So channel fill will likely be at least 2M units. I think Apple will report a terrific quarter.

    Mind sharing your EPS # or is that under embargo by PED?

    Sure, I see $11.65

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    Posted: 16 April 2012 11:53 PM #36

    Sounds about right for your iPhone number and what I surmise is a 11-12M iPad number.

    I agree that $11.65 is a fine result for Apple.  But when up is down, I don’t know how WS would take a “mere” 82% YOY EPS growth (normalized to about 80% net income growth if you overcompensate for share creep).

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  • Posted: 16 April 2012 11:57 PM #37

    turleymuller - 17 April 2012 02:49 AM


    Sure, I see $11.65

    I dialed in your 34M iPhones using an Excel combo box and $11.83 popped up.  We must be close on the other details.

         
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    Posted: 17 April 2012 12:00 AM #38

    Whatcha think Mercel?  $11.65 would make WS happy enough?  I mean, the only reason GOOG tanked was their fugly not-really-dividend-in-the-form-of-a-not-really-stock-split. LOL  Along with blah revs growth and alarming revenue metric deceleration to go with a modest earnings beat. :D

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  • Posted: 17 April 2012 12:05 AM #39

    Mav - 17 April 2012 03:00 AM

    Whatcha think Mercel?  $11.65 would make WS happy enough?  I mean, the only reason GOOG tanked was their fugly not-really-dividend-in-the-form-of-a-not-really-stock-split. LOL  Along with blah revs growth and alarming revenue metric deceleration to go with a modest earnings beat. :D

    With the selloff we’ve had, WS could (and should) reward AAPL at its current price.  If AAPL was trading at $644, I’d be more concerned.  Let’s see where the whisper # lands.  I’m expecting higher than $11.XX.

         
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    Posted: 17 April 2012 12:08 AM #40

    I think that damn “whisper” number might just end up a bit shy of last quarter’s!

    But Earnings Whispers.com is a completely unsourced and unaccountable piece of - code. :innocent:

    [ Edited: 17 April 2012 12:11 AM by Mav ]

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    Posted: 17 April 2012 12:11 AM #41

    Coincidentally, it’d take a $11.29 quarter for AAPL to hit the magic $40 ttm EPS.

    Considering my earnings baseline ended up being $10.68 - before the new iPad blew the doors off - I think Apple should report comfortably over $11.29.

    Agreed that there’s a _little_ less pressure on AAPL if the selloff precedes earnings.  But I think the selloff would be worsened if Apple somehow disappointed.  Which I have such a very hard time seeing Apple doing, unless the ascendance of iPhone is fading.  None of the data remotely supports that yet.

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  • Posted: 17 April 2012 08:46 AM #42

    I’m at 36.4 million iPhones. 

    I think there’s a little bit too much focus on this sequential quarterly iPhone growth (some actually model Apple as a whole on a sequential quarterly basis, which I don’t agree with).

    We are just coming off Apple’s largest iPhone launch, with extremely high pent-up demand. I have no desire to model off of something like that.

    Instead, I revert back to:

    1)YOY metrics, including the weekly sales run-rate (I’m estimating 38% yoy growth in the weekly sales rate).

    2)Channel fill. I think some are underestimating how many iPhones can actually fit into the channel. We are talking 10+ million iPhones easily. The difference between many of our iPhone estimates can easily be made up by a few % swing in channel fill.

         
  • Posted: 17 April 2012 09:40 AM #43

    To the points raised earlier, I think the availability of free 3GS and cut rate 4’s are going to drive the numbers into the mid 30MM units sold.  And I believe those higher sales are going to have a positive impact on gross margin.

    Finally, while it’s a small % of revenue, the huge number of iphone/ipad adopters (and usage of all those itunes gift cards from the holiday season) will drive itunes/app related revenue to new heights.  Which will also positively impact margin, as there is minimal cost for that division.

    Final very subjective note - I commute into NYC from NJ, and it seems that there are far more iphones out there than any type of other, more so recently over the past few months ..... as a side note, over the past 4 months, I’ve seen exactly one person using a Windows phone, and maybe 30 people using Blackberries.

         
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    Posted: 17 April 2012 09:04 PM #44

    dsk101867 - 17 April 2012 12:40 PM

    To the points raised earlier, I think the availability of free 3GS and cut rate 4’s are going to drive the numbers into the mid 30MM units sold.  And I believe those higher sales are going to have a positive impact on gross margin.

    Finally, while it’s a small % of revenue, the huge number of iphone/ipad adopters (and usage of all those itunes gift cards from the holiday season) will drive itunes/app related revenue to new heights.  Which will also positively impact margin, as there is minimal cost for that division.

    Final very subjective note - I commute into NYC from NJ, and it seems that there are far more iphones out there than any type of other, more so recently over the past few months ..... as a side note, over the past 4 months, I’ve seen exactly one person using a Windows phone, and maybe 30 people using Blackberries.

    Sloghtly OT, but I can’t wait for the iPhone 4 to become free on Verizon & Sprint this year, the lack of a CDMA iPhone 3GS costing $0 is perhaps the only thing supporting Android sales on those 2 networks. Once the iPhone 4 drops to $0 (after the iPhone 5 intro), it should be game over for android handset makers in the US in marketshare terms.

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    Posted: 17 April 2012 10:25 PM #45

    Good observation, Burgess. smile  It should be glorious for the entire world (if they choose) to have access to a $0 iPhone.  Even though, as you know, GSM is the world standard, so it’s already a problem for Android vendors selling GSM handsets.

    I think the bigger deal is iPhone 4 becoming $0 period.  There is NOTHING like it in the $0 price band, I’m quite sure.  A worldwide swath of destruction/“conquest sales” is nigh for the competition.

    [ Edited: 17 April 2012 10:28 PM by Mav ]

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