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After seeing Verizon report it sold just ~650K iPhone 5s in Q3 due to supply issues, Jefferies'...

  • Friday, October 19, 2012, 3:11 PM ET
    After seeing Verizon report it sold just ~650K iPhone 5s in Q3 due to supply issues, Jefferies' Peter Misek thinks only 5M units may have been sold overall in the quarter - he previously believed sales of 8M-10M were possible. But Misek argues iPhone 4/4S sales will make up for any shortfall to his 26M-unit iPhone forecast. Meanwhile, Stifel notes the iPhone 5 is still back-ordered for 3 weeks at Verizon. Apple (AAPL -2.8%) is selling off along with many other tech large caps, and is down 13% from its Sep. 21 high. (earlier: I, II)
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This news story has 59 comments:

  •  
    So the only iPhone 5 units sold were those over that first weekend? Which totaled an announced 5 million sold?

    http://bit.ly/OP5tpY

    I somehow doubt that.
    19 Oct 2012, 03:21 PM Reply Like
  •  
    Did Apple ship all those iPhone 5 units by the end of the month? They only count towards sales if they did.
    19 Oct 2012, 03:37 PM Reply Like
  •  
    I think the point is: did they launch on Sept 28 in Europe with zero product? If the answer is yes, then maybe 5m is it, but I think this could be verified with even anecdotal research.
    19 Oct 2012, 04:04 PM Reply Like
  •  
    Dear Editor - Apples policy is sales are recorded only when shipped - they then announced on their site (and it is still on there) that they "sold" 5 MM in first weekend. I doubt vey much that they then "shipped" (sold) no phones for the next 5 days to end of quarter.
    19 Oct 2012, 04:11 PM Reply Like
  •  
    That's their policy when reporting earnings, not necessarily for other announcements. This was in the 5M-sale PR:

    "Demand for iPhone 5 exceeded the initial supply and while the majority of pre-orders have been shipped to customers, many are scheduled to be shipped in October."

    FWIW, 5M seems low to me at first glance. But if Verizon only activated 650K, it's possible.
    19 Oct 2012, 04:18 PM Reply Like
  •  
    My brother's preorder arrived after the weekend but before the end of the month/quarter. So the iPhone 5 sales were probably only 5,000,001 sold.
    19 Oct 2012, 05:43 PM Reply Like
  •  
    Verizon is simply one component of a much, much larger worldwide ecosystem of telecom companies, all in different countries, on different continents. And they all want the iphone 5 (or the 4s for free). I can see how they would pump out five million phones in a weekend around the world, and the fellow above raised a good point. Even anecdotal evidence (we didn't hear about riots from stores, for instance, that had no phones at all) would be nice to verify that phones were sold in europe etc.
    20 Oct 2012, 04:22 AM Reply Like
  •  
    And more. Once the factory got going Tuesday and shap or whoever got screens going, apple shipped to preorders and billed the credit cards. Cheated the channel for a day or two I'm guessing.

    Ok look, if earnings are ZERO the trailing P/E is 17. If earnings are $5 then it's 15. My options may hurt me but I'd suggest any young person buy outright shares, like now dude.

    Verizon sold 20% 5s, so if that's average, Apple sold 5 times what? 5 million? 8 million?

    Verizon activated less iPhones than Androids combined. But last quarter AT&T activated 73% iPhones so maybe a whole lot more 4s went out than assumed. Maybe.

    Maybe they sold some new pads and a few computers. Maybe there is a killer app coming Tuesday. We'll see.
    20 Oct 2012, 10:12 AM Reply Like
  •  
    Exactly. If 20% of iPhones sold were 5's and they sold just 5 million of them, that would imply 25 million iPhones globally. And I don't understand why the 5 million number is being used if they had already sold 5 million with a week to go.

    And channel fill does count for quarterly earnings, so it doesn't really matter if they are shipping pre-ordered units or units to stores -- it is how many they can get out the door. I think to assume this is less than 8 million would be folly. So if you assume even 33% of iPhones sold were 5's you still have 24 million iPhones sold.

    I don't see this earnings report being a huge miss. What I do see is that the 7.65 Apple guided excluded the iPhone 5 because they wanted to keep it under wraps. If they had guided 10, everyone would have known it was being released. So they should crush 7.65. I'm thinking 10 is possible. That should cheer up a market that has been very somber about earnings so far.

    It should also bring into sharp relief that some of the competitive forces that are weighing on other tech are radiating from Apple.
    20 Oct 2012, 01:16 PM Reply Like
  •  
    Thats what I am thinking collateral damage....all the techs blown up lately..I believe aapl is causing others misses....
    20 Oct 2012, 01:19 PM Reply Like
  •  
    This time, Peter Misek has to be incorrect, how can he basing his estimates on Verizon when there are the other domestic carriers and all the iP5s sold in Australia, Canada, France, Germany, Hong Kong, Japan, Singapore and the UK? Apple was misrepresenting the 5m in the first 3 days as well?
    20 Oct 2012, 09:33 PM Reply Like
  •  
    Good point about apple being conservative to keep iPhone 5 under wraps. I had been thinking the 8.85 was middle of the likelihood range, but your point increases my optimism.

    Map gate, scratches on the teapot, and factories closed by riots notwithstanding, I believe the part of this pullback connected to the stock, as opposed to the general market or sector, is the savvy traders' and fund managers' anticipation of a "miss" due to customers holding off for the 5 and the 5 getting only a couple weeks in the quarter. I suspect their plan is to wait and watch and come back in after reaction to earnings, but watch closely so as not to miss out when the herd turns.

    The face off on main street is underway. Who will draw first and hit the buy button?
    21 Oct 2012, 01:55 PM Reply Like
  •  
    Obviously, they must have stopped selling iPhone5s. And the iPad Mini is just a hoax. Come to think of it, maybe Apple stopped selling iPads in general? Or add any more carries, stores?

    In fact I heard they are shutting down the business and giving money back to shareholdes, because can't sell any more product.
    19 Oct 2012, 03:41 PM Reply Like
  •  
    I am not at smart as the analysts but my order for an Iphone 5 that I placed on Oct 1st will arrive on Monday the 22nd according to an e mail I recieved today. My friend has his and it is blazingly fast and SIRI is a lot more intuitive with much less mistakes. He has not had any problem with his maps either which now has voice instructions.
    19 Oct 2012, 03:44 PM Reply Like
  •  
    From the harsh treatment of Apple shares due to supply issues only, I suggest that Apple create an artificial demand for the iPhone 5 such as that done for diamonds by DeBeers, a company which has warehouses full of diamonds in Europe but tightly controls their sale prices by artificially creating a constant shortage through limiting the market supply at any time.

    Kidding, yes, but only a bit.
    19 Oct 2012, 03:47 PM Reply Like
  •  
    I believe the word was "constraints". I've not actually heard any evidence that production is down, just that they can't make the hot cakes as fast as the mob eats them.
    20 Oct 2012, 10:16 AM Reply Like
  •  
    Could be worse... GOOG is down almost 13% in 24 hours. ;-)
    19 Oct 2012, 04:05 PM Reply Like
  •  
    Google profit is down in this quarter, Motorola has lost 527 million in the 3rd quarter, and 881 million this year so far with one more quarter to go. Google should be down.
    19 Oct 2012, 04:33 PM Reply Like
  •  
    Time to buy.
    19 Oct 2012, 05:04 PM Reply Like
  •  
    Go for it. There's a couple of hundred hedge funds waiting just for you.
    19 Oct 2012, 06:33 PM Reply Like
  •  
    Pretty soon the discussion will be back above 600 first, or below 500?
    19 Oct 2012, 05:14 PM Reply Like
  •  
    Looks like all the bad news is baked in. Stock should be around 650 after earnings. Lets see.
    19 Oct 2012, 05:15 PM Reply Like
  •  
    Options are implying a 7% move right now, which would get AAPL north of 650. Let's also bear in mind AAPL had almost a 9% move post earnings not long ago.
    19 Oct 2012, 05:50 PM Reply Like
  •  
    Um, not quite. More like a 3.5% move which could get the stock to about $630 or down to $590. Buy options they are half as cheap as you thought.
    19 Oct 2012, 05:56 PM Reply Like
  •  
    Sorry but this is not correct. The way you calculate implied move is to look at the price of an at the money straddle, as a percentage of stock price not just just a the price of a put or a call. Check the price of next week's 610 straddles
    20 Oct 2012, 02:24 AM Reply Like
  •  
    This makes absolutely no sense. 5 million were reported sold first weekend. And the phone was launched in several other countries before month end. How could they launch with no iphone 5 on hand. This is completely illogical.
    19 Oct 2012, 05:16 PM Reply Like
  •  
    I can't speak for anyone else, but I definitely want to own any company that keeps selling all of their product inventory the very first few days it goes on sale!
    19 Oct 2012, 05:31 PM Reply Like
  •  
    Want some NVDA?
    19 Oct 2012, 07:16 PM Reply Like
  •  
    Buying at close for $610 a share. Thank you knee jerk sellers!
    19 Oct 2012, 05:32 PM Reply Like
  •  
    Nd when did Verizon become hte barometer over AT&T?
    19 Oct 2012, 05:37 PM Reply Like
  •  
    Verizon got the iPhone 5 last. I don't think they had them on the launch date. Plus, when 4s was launched, this means most Verizon customers were still in contracts. AT&T sold most of the bulk of phones as well as apple stores, I'm sure.
    19 Oct 2012, 05:57 PM Reply Like
  •  
    So Apple sold 5 million iPhones in the first 3 days of its launch and only sold 5 million total for the quarter. They didn't sell a single iPhone 5 in the last week of September? Apparently those shipments that kept arriving at all Apple Stores and retailers must've been shoplifted in mass quantities.
    19 Oct 2012, 05:43 PM Reply Like
  •  
    Yes, it is all those car-crashes into Apples stores -they took those iPhone5s.

    Also, I saw employees handing them out for free (thus no revenue) - that explains why folks line up everyday. (Otherwise the iPhon4 is just fine.)
    19 Oct 2012, 07:04 PM Reply Like
  •  
    Its not any analysis faults its apples and chinas. Apple wanted to make the phone thinner and it made it hard for china to make the phone it took them longer to make it smaller. now apple has a short supply. The earnings are gonig to get destroyed this stock will fall under 600 next week. Im a buyer at 550 point. I am definitely not paying 600 for it. There is just no way they will beat earnings. With all the negativity around apple wait till they miss earnings and they get hit hard by the analysist its going to kill the stock price.
    19 Oct 2012, 05:43 PM Reply Like
  •  
    Nice. Another dream to be missed. Just buy man- its not gonna go that low unless market wide drives the stock down. Today was market wide, not apple. Apple gets dragged down with the market and can't hide due to its sheer size.

    I'll take a second mortgage on my house and buy stock if it hits 550. But, don't be a dreamer. I recall the analysts on CNBC in April saying apple would hit 525 or 500. After earnings, it was 610-618. Eventually over 700. Another dream shattered. Now, it did hit 530 in May when the overplayed Greece issue drove the market down. But, this was market induced, not Apple. Distinguish the difference.
    19 Oct 2012, 06:02 PM Reply Like
  •  
    Funny how no matter what the price is, everyone claims to be a buyer "later" at "50" points lower. Dumb is the new Smart Money
    19 Oct 2012, 07:05 PM Reply Like
  •  
    You won't get $550 unless the entire market collapses. Apple's 200 day moving average is currently at $582. It's been below it's 200 day exactly 1 day in the last year, Black Friday, and that was the beginning of its massive run over the last 11 months and it only held for pennies below very briefly on that one day.
    20 Oct 2012, 03:35 AM Reply Like
  •  
    Not me. I'm outa cash. Buddy, can I have a loan? :-)
    21 Oct 2012, 02:09 PM Reply Like
  •  
    Margin Compression
    19 Oct 2012, 05:45 PM Reply Like
  •  
    The entire stock market is being manipulated. Political advertising the last few days has been geared to this.
    19 Oct 2012, 05:46 PM Reply Like
  •  
    Kass "APPLE is topped at $90" fame is still getting ink again today.
    19 Oct 2012, 06:21 PM Reply Like
  •  
    Kass's problem is that he's got one extra letter "K" in his name.
    19 Oct 2012, 07:06 PM Reply Like
  •  
    Yes, the 5 million the first weekend us shipped. Earnings announcements include channel sell. 5 million is the floor, before you have the rest of the week and before the units sold and channel fill for the 22 countries on the 28th
    19 Oct 2012, 07:14 PM Reply Like
  •  
    Time to sell all AAPL and switch to MSFT. AAPL will be $400 by Dec. 2012.
    19 Oct 2012, 09:19 PM Reply Like
  •  
    If Apple goes to $400, MSFT will be $11.
    19 Oct 2012, 09:34 PM Reply Like
  •  
    Lumia 920 and Surface will prove otherwise.
    19 Oct 2012, 09:46 PM Reply Like
  •  
    I know that was a typo. You meant $700+, right?
    20 Oct 2012, 09:20 AM Reply Like
  •  
    I seriously doubt that.... MSFT is a rock.... has been rangebound for years trading between $25-30/share. AAPL could go to $300 and MSFT might hit $24-25 again
    22 Oct 2012, 08:57 AM Reply Like
  •  
    you ever had
    deja
    deja
    deja
    deja vu ?
    19 Oct 2012, 09:44 PM Reply Like
  •  
    Attack ads are classy, amirite?

    Maybe Apple should do an add about all the people who've stood in line for Android phones ...oh wait...
    22 Oct 2012, 10:48 AM Reply Like
  •  
    Android users have better things to do than wait in line for a phone, one that requires brand new accessories no less.

    "But they make the COOLEST adapters"
    22 Oct 2012, 11:06 AM Reply Like
  •  
    Baring any macro disasters, AAPL will easily be up 20-30% from here by New Years.
    20 Oct 2012, 04:14 AM Reply Like
  •  
    Hedge funds didn't go in to support it, if they didn't go into support it, well that means they didn't go into support it. You and I don't move the needle. Watching things like EBAY, see if it holds, or is it time to take the money and run. Same goes with SNDK. Retail stocks report much farther out, PVH is the best one, it's a two to three day look after it reports, if it starts to roll, then retail starts to roll. Same goes with home builders, they reported recently and have much farther out for there reports, watch LEN, RYL, TOL .But you are right, Obama's reluctance of 250,000 brings the FISCAL CLIFF closer to reality. Blackrocks FINK, Simpson'Bulls,The Banks , even the CBO statements. Every one's watching 1425 S&P, me 1396. I am watching PIR, will pick up a little more around low 18's if it gets there. Also watching LLY after it reports, Also will buy TGT if I can get it 55., 50., but the FISCAL CLIFF is the problem, if it transpires all bets are off, or on the shorts have to make money too. Will buy INTC around 19. still have DELL, HPQ to report, CSCO is one to keep a close eye on. Wonder if The Surface will have HALO installed. THINK like FINK.
    20 Oct 2012, 06:18 AM Reply Like
  •  
    Bailin is spot on, the best you can hope to do is pick up AAPL at the 200 day ma (580), as the long only funds will come in with major volume. I started to scale in at 610, but hope to get most in the 580 range. We should get to 800 by April. BTW, it would be a major aberration if it doesn't make it back to 660 - 670 for the ipad mini ship date. The technicals drive this stock.
    20 Oct 2012, 08:46 AM Reply Like
  •  
    I wonder how many people are going to cancel their iphone 5 orders or a better question would be can you cancel?
    20 Oct 2012, 03:00 PM Reply Like
  •  
    Why would you?
    22 Oct 2012, 10:49 AM Reply Like
  •  
    I bought a better phone, the Nokia Lumia 900
    22 Oct 2012, 02:06 PM Reply Like
  •  


    Why do so many take the view that Apple is in a sprint when it comes to iPhone sales?

    I like to take the approach that they are in a marathon and by the end of the race, they will be just fine. The phones will reach the consumer, does anyone doubt this?

    The finish line keeps getting farther away for Apple as the iPad mini is set to debut.
    20 Oct 2012, 05:24 PM Reply Like
  •  
    It doesn't seem to be such a problem having so many orders to fill that you can't fill them all. Many companies would love to be faced with this problem, and at least in Apple's case, their massive production facilities in China will eventually rise to the occasion, and provide a valuable lesson for Apple in future product rollouts. I ordered an iPhone 5 a little after midnight the morning it became available and had it within in a week or so. It is the best phone that I have ever had. My life now revolves around Apple, and its products, others have referred to it as the Apple ecosystem. I wouldn't have any use for a "stand-alone" phone. Apple products just don't "stand alone", they have the whole constellation of other Apple products standing with them.
    21 Oct 2012, 06:35 AM Reply Like
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