Market consultancy NPD DisplaySearch reportedly out with a research note on Sunday indicating Apple (NASDAQ:AAPL) will miss its 2013 iPad shipment target by quite a wide margin. The combined sales of the two models will only reach 74 million units, according to the report, well below the 88 million initially estimated. Total is comprised of 31 million of the 9.7-inch version and 43 million of the "iPad Mini". Last two reporting quarters saw sales of just below 23 million and 20 million respectively.
Apple typically does not comment on speculation about its internal estimates in tech blogs, and this is also not the first time that rumors circulated about a major slowdown in iPad demand. Supply chain sources have hinted that sales this quarter could drop as low as 10 million units, pointing to tighter competition from the popular Samsung Galaxy Note lineup as well as some of the lower-priced entry-level tablet alternatives.
Notwithstanding the development and transition to iOS 7, Apple could benefit from greater visibility on its product refresh cycle. Reports out of Gartner last week estimating that the iPad Mini now accounts for some 60% of the first quarter iOS sales, but projections for the release of the next version of the device are now being extended into the early part of 2014.
That uncertainty, compounded by what a research note from Gartner saw as a shift in focus toward software rather than hardware, is in all likelihood extending the household lifetime of the iPad Mini that will ultimately translate into bloated inventories. Already on the last earnings conference call, CEO Tim Cook expressed disappointment over the declining iPad Mini margins and falling ASPs.
Shares of Apple are at a particularly precarious juncture, failing to gather any upward momentum after a brief respite from the selloff in early May. Instead, AAPL once again slid below the $400 level, threatening the first close below $39 since late 2011.
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