Market Overview

iPhone 4 Demand Overwhelmed Apple in FY Q1

On Wednesday, Apple (NASDAQ: AAPL) announced that it sold 47.8 million iPhones.

This impressive figure shows that Apple has not lost its touch, not even as analysts and investors question the firm's ability to deliver successful upgrades. What most people do not realize, however, is that those sales figures do not apply to the iPhone 5 alone -- they apply to all of the iPhone models currently available.

Thus, sales of the iPhone 4 (which is free on many carriers with a contract) and the iPhone 4S ($99 with a contract) are also included. To be clear, Apple still profits from the "free" iPhone 4; the carrier pays for the phone to encourage users to sign a contract.

With all three of the iPhones lumped into one sales sheet, it is impossible to know exactly how many units Apple has sold of each model. Researchers at IDC are providing some clues, however. According to IDC's latest report, Apple's success was "due in large part to older models, in particular the iPhone 4, which Apple couldn't make enough of in the quarter relative to demand."

"Its sales success with the older model could portend success in higher-growth emerging markets where the company has performed well," researchers concluded.

Apple's growth -- with both older and newer iPhone models -- should theoretically boost the company's value. However, nothing that Apple has done over the last six months has been able to provide the firm with a significant and sustainable increase.

Apple has lost more than 21 percent of its value since July 25, 2012. By comparison, the company rose more than five percent during the year ago period (July 25, 2011 to January 24, 2012).

Most of Apple's recent gains -- which have been scarce and short-lived at best -- have surrounded the company's annual product lineup. The rumor mill had convinced some investors that Apple would dump the iPhone 5 and release an upgrade (presumably titled the iPhone 5S) in January or February. Most analysts disagree with these rumors.

KGI Securities analyst Ming-Chi Kuo believes that the next iPhone will not be released until next summer. In fact, Kuo estimates that Apple may not release much of anything before the third quarter.

If it weren't for the ongoing success of the existing iPhone and iPad models, Apple might be in trouble. The proof is in the sales, however, and Apple's have been filled with record-breaking numbers every quarter.

Follow me @LouisBedigianBZ

Posted-In: Apple iPhone 4 iPhone 5 iPhone 5SNews Success Stories Tech Best of Benzinga

 

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