Aggressive iPhone launch plan boosts Apple outlook

By Aditi Sharma and Sayantani Ghosh /Reuters

Apple’s CEO Tim Cook presents the new iPhone 5 on Wednesday in San Francisco, California. The new model ships on September 21 in the US, Australia, Canada, France, Germany, Hong Kong, Japan, Singapore and Britain, and will hit 100 countries by the end of the year in the fastest international rollout for an iPhone so far

Sales of the new iPhone 5 could be double those of the previous model in its first week on the market, thanks to Apple Inc’s most aggressive smartphone launch plan yet, and up to 33mn iPhones may be sold this quarter, analysts said. Many expressed surprise at how quickly Apple planned to roll out the new model around the world, saying this showed supply constraints that afflicted past releases would not be a problem this time for the bigger, faster and slimmer iPhone 5. The new model ships on September 21 in the US, Australia, Canada, France, Germany, Hong Kong, Japan, Singapore and Britain, and will hit 100 countries by the end of the year in the fastest international rollout for an iPhone so far. While many Apple watchers said the new iPhone lacked a “wow” factor, Apple shares rose after the launch, in contrast to a fall after the launch of the previous model, the 4S, almost a year ago. “We are positively surprised that this iPhone rollout is Apple’s fastest yet,” Barclays Capital said in a client note, adding that it had previously thought supply constraints for sensors in the new screens would hold back initial sales. “Given this pace it would seem Apple is very well positioned for upside in the December quarter.” Analysts raised forecasts for Apple’s share price by as much as $200 to between $750 and $1,000. Apple shares were up 1.1% at $676.91, in heavy trading on the Nasdaq. The iPhone 5 sports a 4-inch “retina” screen that displays a sharper image. It can run on high-speed 4G LTE wireless networks and is 20% lighter than the previous iPhone 4S. “While it lacked the mind-blowing innovation we have come to expect of Apple, (it) is differentiated enough to maintain a sizable product advantage over its competitors,” said FBR Capital markets, the brokerage that is forecasting Apple’s shares to hit $1,000 within the next year. The previous iPhone 4S initially got a muted response from investors on its launch in October 2011, but customers loved it and booming sales have pushed Apple stock up 80% since. Apple will continue to win sales with older models, brokerage William Blair & Co added, putting more pressure on Research in Motion’s BlackBerry, other offerings from Nokia and less-sophisticated smartphones that use Google’s Android software. “The iPhone 4 will be sold for free after subsidies, replacing the 3GS and providing a strong product to compete in the high-growth, low-end smartphone market,” William Blair said. The brokerage raised its sales forecast for all iPhone models by 29% to 33mn for the July-September quarter, at the top of forecasts seen by Reuters. Brokerages raised their sales estimates for the September quarter from anywhere between 3% to 36%, with most expecting between 20mn and 30mn iPhones to be sold. Janney Capital Markets said it expected the iPhone 5 to sell 7mn to 10mn units by the end of the month, while RBC Capital Markets expects 8mn to 10mn to be shipped during the same period.