Apple Inc. (AAPL) iPhone 6 Record Weekend Sales Means A Lot More Than You Can Imagine

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Apple Inc. (NASDAQ:AAPL) announced on Monday that it has sold over 10 million new iPhones 6 and iPhones 6 Plus models. It’s been merely three days since its launch on September 19 and is said to have broken all previous records. Apple had already muted analysts with its pre-order sales which went as high as 4 million in the first 24 hours. With this latest press release, it is already being compared to the weekend sale of iPhone 5s and iPhone 5c models of the previous year which topped nine million. It is one million more than previous year sales of 5s and 5c and doubles that of iPhone 5 two years ago. What makes the number more staggering is the fact that they do not include China’s share where these two new launches are yet to be released. MacStories has analyzed the iPhone pre-order sales and opening sales and the comparison with previous versions describing the success of Apple.

iPhone Opening Weekend Salesiphone opening weekend sales

Lately, the momentum gained from the opening weekend will definitely help carry Apple to record sales this holiday quarter. Apple will sell about 58 million iPhones in the holiday quarter, up from 51 million in that period a year ago, estimates Maynard Um, a senior research analyst for Wells Fargo. However, another financial analyst Toni Sacconaghi from Sanford C. Bernstein estimates this figure to be between 55 million to 60 million during the holiday season.

Apple’s iPhones are not only about features, consumer’s geography has a big hand

With the launch of smartphones with the larger screen, a dynamic shift in the market preference has been observed. Consumers in certain economies tend to be driven more by the brand than the application, features or the operating system. In such a scenario, Apple already has a lead over the others. Particularly in Asian countries, consumers tend to lean towards the larger screen phones. They have been found to be the quickest adopters of the iPhone6/6 Plus, as per the Localytics. This analytics company with its data-centric approach also found that more industrialized countries tend to prefer larger screen size. It has been reasoned out because of their ability to afford and willingness to pace up with the latest technology.


It also found that cities with a longer commute and/or higher number of knowledgeable workers tend to prefer large screens. It has been backed on the grounds that browsing during a long commute requires devices with the large screen for convenient use of mobile apps and enhanced experience.

The implication of September and December quarter

It is expected that the September quarter will see a 7% quarter over quarter increase with the selling of 38 million iPhones. This is a positive sign when compared to the September quarters of 2012 and 2013 where sales were down 1% and 4% quarter over quarter, respectively.

If we assume analytics estimation to be true and take 38 million Phones as the estimated number of iPhone that will be sold in the September quarter, October to December iPhone unit growth rate to be 60% and channel inventory increases by 800,000 then the company would sell about 59.6 million.

Why is China so important to Apple’s success?

With China’s wireless subscribers around 1.27 billion, 3G subscribers account for 497 million. China Mobile (NYSE:CHL), a leading telecom service provider, reported a total of 796 million subscribers in August, with 3G and 4G customers accounting to 242 million and 29 million respectively. The numbers of subscribers have been increasing gradually. comScore report compares it with the US, which has 173 million smartphone users out of a total of 241 million wireless subscribers. Moreover, IDC, a research company, estimated that at least 20 percent of all smartphones shipped last year in China – the largest smartphone market – were five inches or larger. Considering these factors in the context of 4G enabled large 4.7-inch and 5.5-inch iPhone it’s evident that the China market is vital for Apple’s success.

Not vital currently, China will be instrumental in Apple’s success next year

Though the numbers above suggest that China is indispensible for Apple’s growth, however, it is to be noted that having China as a part of the first official wave would have only been a disadvantage. Already the lead-times for 6’s is varying from 7-10 business days to 3-4 weeks (as per Apple’s US website).

Even without China, Apple was able to move $6.5 billion of product in three days, which would be impressive for any industry,” said Walter Piecyk, managing director at BTIG Research.

China’s inclusion would have made it more difficult to fulfil customer orders. China is responsible for about 17% of Apple’s total revenue in fiscal 2014. Owing to its growth of 20% year over year, the company will need China soon, but probably not currently. By early 2015, with Chinese New Year starting on February 19, Apple can expect China to play its role in making iPhone 6/6 Plus a success beyond measure.



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