Why Apple Is Going To Surpass Street's Consensus Of 54 Million iPhone Sales? This Analyst Provides The Answer

With Apple Watch sales beating previous forecasts, the debate has now shifted to whether Apple Inc. AAPL will beat street's consensus on iPhone sales and when the watch will make a material impact to Apple’s revenue?

Citi technology analyst Jim Suva, was on CNBC recently to answer those question.

Beating iPhone Sales Forecasts

“Importantly we think that they are going to beat consensus on the iPhone by about 5 million units,” Suva said. “We have 59, consensus is only at 54. We think they are going to upside on the iPhone units, but importantly…a precursor that they are rolling out with new products, things like Apple phone , Apple Pay.”

“We believe that there’s more new products to come whether it’s advertising, TV broadcasting, Apple Passbook. We think iPhone is a focus today, in the future many more products.”

More Than A Phone Company

Suva was asked when does the Apple Watch turns to a material element for analysts to put it into their models through which they value Apple’s stock. He replied, “Well importantly you know, it’s just got online orders and we do believe that as the future progresses we will be able to assess that more, but let me quantify that it a little bit.”

“On a annual run rate we are building in about 20 million units…that represents about 5 percent of the company’s installed base, only 5 percent of the installed base, if you say that there’s going to be 10 or 20 percent that takes it much more richer.”

“But we are running 20 million units per year and that’s about 3 million units for the first-quarter and importantly that will allow the company to start to show that they are more than just a phone company. Then we start at looking at things such as Apple Pay, Passbook and things like that,” Suva concluded.