AT&T to Set New Quarterly iPhone Record in Holiday Q4 [Update]

[Updated at 8:07 PM: Late on Wednesday, UBS analyst Maynard Um released a second research note raising his December forecast for Apple’s iPhone sales to 30 million units. Accompanying the new forecast, the analyst raised Apple’s revenue estimates to US$38.5 billion from $37.2 billion. He raised earnings per share estimates to $9.90, up from $9.47. - Editor]

iPhone Sales

AT&T told UBS analyst Maynard Um that its iPhone sales are off the hook this quarter. Ma Bell said on Wednesday that it sold some 6 million iPhones in just the first two months of the quarter, just shy of the company’s previous full quarter record of 6.1 million units—the company expects to blow past that number during December, which has traditionally been a good month for the iPhone.

The company said that pent up demand for the iPhone 4S, which was released at the beginning of the quarter, was a big part of why the device is doing so well at the carrier. It also expects the iPhone 3GS, which is free with a two year contract, to boost sales during December.

In a research note obtained by The Mac Observer, Mr. Um said that he had modeled for just 6 million iPhones sales through AT&T for the full quarter. In light of AT&T’s announcement, he increased that forecast to 7.2 million—a number that most will still see as quite conservative.

Despite this change, he did not adjust his overall iPhone forecast for Apple, leaving that number at 28 million units for the quarter [Editor’s Note: See the update note above for revised estimates]. He did say, however, that he continues to see upside to that estimate, and noted that for every one million units in incremental iPhone sales, Apple’s earnings per share (EPS) goes up by about US$0.24.

He also noted that overall Phone 4S demand remains strong, writing, “Demand for iPhone 4S remains robust as the holidays draw closer and Apple continues to expand country and carrier launches. Online wait times are still 1-2 weeks and our most recent checks indicated the device continues to sell-out at stores daily.”

Mr. Um maintained his “Buy” Rating on AAPL and his $510 price target for the stock.

Shares of AAPL moved lower on Wednesday, ending the day at $389.09, down $1.86 (-0.48%), on light volume of 10.9 million shares trading hands.

*In the interest of full disclosure, the author holds a tiny, almost insignificant share in AAPL stock that was not an influence in the creation of this article.