European iPhone Sales Better Than Expected

Sales of the Apple (AAPL) iPhone in Europe are better than some investors thought, according to a research note today by RBC Capital’s Mike Abramsky.

Abramsky says carrier meetings and store visits in the U.K., France and Germany “point to solid European iPhone momentum.” He expects the company to sell 400,000-500,000 iPhones in Europe in the fiscal first quarter ending December 31, of an expected 1.65 million units. He sees 4 million units selling in Europe in calendar 2008; he raised his forecast for total calendar 2008 iPhone units to 12.5 million from 12.1 million.

Abramsky says that despite a lack of 3g and advanced Bluetooth functionality - and despite the high price of the device - “iPhone appears to be an early hit with European Smartphone consumers.” He says the phone outselling some competitive smartphones at O2, Orange and T-Mobile stores, including the Nokia (NOK) N95 and E-Series, the Samsung Blackjack, LG PRada and HTC Touch and Herald.

And he adds that once Apple launches a 3G version and spreads distribution to more countries, “European iPhone sales appear poised for material improvement in demand and momentum.”

Abramsky tweaked his EPS outlook for the company; he now sees $4.81 for FY ‘08, up from $4.80; he goes to $6.02 from $6 for FY ‘09.

Apple Wednesday is up $4.94, or 2.8%, at $184.75.

Comments

[awcabot]

So Abramsky raised F2008 EPS by less than 1%. I suppose that he never learned the concept of significant digits and rounding errors.
He might as well have left his teeth together and saved his employers some time.

[Tom B]

I expect more iPhones to be sold PER CAPITA in the EU than the US. Europeans are more "used to" the smartphone concept and will appreciate the advanced tech in the iPhone.

[eltractor67]

I was looking around for comments on the failure of the iPhone in Europe, and I stumble on this article that projects the opposite impression.
Numbers rarely lie, in the U.S. the iPhone sold some 250,000 units in the first week(-end), and in Europe we have just 50,000 in the first week: 30,000 France, 10,000 Germany and in the UK they won't comment on numbers, so let me assume 10,000 units.
I would like to venture that iPhone has been affected by high pricing (especially given the weak US$), Nokia market dominance, and perhaps the fact with 3G the iPhone is not so revolutionary in Europe the way its been in the U.S. I am just trying to get some comments going.

[Tom B]

90,000 units in the the 3 countries you cite doesn't seem bad at all, on a relative population basis.

[eltractor67]

Hi!
where is the 90,000 figure coming from? it is only 50,000 in Europe. No, it is not a bad number regardless, its just that its as remote as it can get from the enthusiastic U.S. reception.
Also, I do not know how many Europeans have picked up the news but when somebody at AT&T announces right before the holiday season that the 3G version is just a few months away, that can't be good for sales of iPhones.

[samij]

Remember that RBC Capital’s Mike Abramsky estimated the US lauch weekend sales to be over 500k. So if every other source indicates towards laggish iphone sales in Europe and Mike says something else, I'd say it's most likely that Mike being overly positive once again.

Funny btw how these over the top estimates on Apple's sales get published on this site several times, but eg the first weekend sales you mentioned are only found in comments.

[User 128606]

"expect more iPhones to be sold PER CAPITA in the EU than the US. Europeans are more "used to" the smartphone concept and will appreciate the advanced tech in the iPhone."

So iPhone is suddenly a smartphone with advanced tech? Seriously? Its but a bundling of two years old tech. And no, it's not a smartphone. Email and a web browser do not turn a phone "smart", at least not in Europe. On the other hand, it lacks seriously on the multimedia department, too, so I don't know what it really is.

It's a nice toy to play with for a while, yes, and it is very advanced for the US markets. Elsewhere it is quite unimpressive.

I wonder how Apple will manage to sell that device beyond its established user base in Europe, where most people have never even heard of iPhone... or Apple. Apple is not a global brand in the league of the likes of Nokia, Samsung etc.

Apple has done nothing to improve that. I guess they believe the operators will simply do all the dirty work for them. I wouldn't count on that -- the European operators don't need Apple, unlike, say, AT&T, to do sound business.

[User 128606]

"expect more iPhones to be sold PER CAPITA in the EU than the US. Europeans are more "used to" the smartphone concept and will appreciate the advanced tech in the iPhone."

So iPhone is suddenly a smartphone with advanced tech? Seriously? Its but a bundling of two years old tech. And no, it's not a smartphone. Email and a web browser do not turn a phone "smart", at least not in Europe. On the other hand, it lacks seriously on the multimedia department, too, so I don't know what it really is.

It's a nice toy to play with for a while, yes, and it is very advanced for the US markets. Elsewhere it is quite unimpressive.

I wonder how Apple will manage to sell that device beyond its established user base in Europe, where most people have never even heard of iPhone... or Apple. Apple is not a global brand in the league of the likes of Nokia, Samsung etc.

Apple has done nothing to improve that. I guess they believe the operators will simply do all the dirty work for them. I wouldn't count on that -- the European operators don't need Apple, unlike, say, AT&T, to do sound business.

[User 169648]

"So iPhone is suddenly a smartphone with advanced tech? Seriously? Its but a bundling of two years old tech. And no, it's not a smartphone. Email and a web browser do not turn a phone "smart", at least not in Europe. On the other hand, it lacks seriously on the multimedia department, too, so I don't know what it really is."

It is not the technology within the iPhone that matters - it is the interface and experience that Apple is betting on. The touchscreen is actually quite revolutionary compared to previous touchscreen technology found on car GPS systems, electronic slot machines, and tablet PCs. The iPod after all is nothing but a bundling of existing technologies and the coincidental existence of a newer smaller hard drive.

Steve Jobs mantra has always been that consumers will trade features for ease of use and clean interfaces, and for the majority of users, he is right. Those of us that understand the benefits of a slightly faster internet connection and exchange support are simply the minority.