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Apple’s iPhone Launch Wasn’t as Good as It Seems

9 million is a lot of iPhones, but there's more to the story

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In raw numbers, the 9 million iPhones Apple says it sold over the weekend is incredible. That’s more than double the 3.7 million devices BlackBerry (BBRY) sold in the entire previous quarter. It’s a 125% increase over the relatively anemic iPhone 5 launch and easily exceeds analyst expectations in the 6 million to 7 million range.

However, this launch has been markedly different than previous ones. The iPhone 4 launched in 5 countries initially, and in the U.S. it was an AT&T (T) exclusive. The iPhone 4S launched in 7 countries, including three carriers in the U.S. The iPhone 5 launched in 9 countries and in the U.S. it again was available for AT&T, Sprint (S) and Verizon (VZ). In other words, successive iPhone launch weekends have seen the potential market for the devices — and thus the pool of early adopters — increase every year.

This past weekend, Apple released not one, but two new iPhone models: the iPhone 5s and the iPhone 5c. They covered slightly different price points, with the iPhone 5c being $100 cheaper. In the U.S., the new iPhones were available through four wireless carriers, with T-Mobile (TMUS) being added to the mix. The new iPhones were available in 11 countries at launch, and for the first time, one of those countries was China — the world’s largest smartphone market. Comparing this iPhone launch to previous ones is truly a case of comparing apples to oranges.

Making things even murkier are reports from the Wall Street Journal that of the 9 million reported sold, 3 million to 4 million units might be iPhone 5c units that remain sitting on shelves at non-Apple retailers. The flagship iPhone 5s did sell out, but Apple hasn’t confirmed how many units that represents. So how many iPhones were actually in consumers’ hands after that weekend? Good question.

If investors have been guilty of being bearish on Apple after previous iPhone launch weekends, this time around seems to be the opposite. I’m not saying Apple isn’t going to sell a ton of iPhones and have a killer year. What I am saying is that I’d take that 9 million sold number with a big grain of salt, and don’t buy Apple based on an expectation that the company will sell 125% more iPhones in the coming year.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

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