Apple sells 5 million iPhone 5 units in 3 days, still disappoints

Apple sells 5 million iPhone 5 units in 3 days, still disappoints

Summary: Apple sold a whopping 5 million iPhone 5 units over launch weekend. That's great---unless Wall Street analysts were predicting about 6 million.


Apple said it sold 5 million iPhone 5 devices over launch weekend, but that figure may have fallen short of the lofty expectations of Wall Street analysts.

The company's Monday press release landed as expected. Apple said it sold a bunch of iPhone 5 units and demand outstripped supply. Many preorders will slip to October and miss the current quarter.

Apple CEO Tim Cook said:

While we have sold out of our initial supply, stores continue to receive iPhone 5 shipments regularly and customers can continue to order online and receive an estimated delivery date. We appreciate everyone’s patience and are working hard to build enough iPhone 5s for everyone.

Now here's the catch---and the absurdity at times---of the expectation game.

As noted previously. Wall Street analysts such as Piper Jaffray's Gene Munster were looking at 6 million to 10 million units in the first weekend.

Munster had said:

We believe that the reported 2 million iPhone 5 pre-order unit number suggests that Apple could sell 6-10 million phones in the launch weekend. We believe Apple will issue a press release on Monday September 24th about launch weekend sales. The mid-point of our weekend sales total would suggest 100% y/y growth from the iPhone 4S launch. We note that iPhone 4S grew 135% y/y in its launch weekend compared to the iPhone 4.

In that context, Apple's 5 million units for the iPhone 5 look disappointing. It's unclear how supply hurt sell-through, but Apple shares are already selling off in premarket trading.


For comparison, Apple sold 4 million iPhone 4S on launch weekend in 2011.

Update: Analyst reaction was mixed. Munster said:

This morning Apple announced the sale of 5 million iPhone 5s in the first weekend compared to our 8 million estimate (6-10 million range). We believe there are two factors that negatively impacted the number. First, our sales expectation assumed that Apple would include all phones pre-ordered online. We believe that this may have been up to 1 million additional units as units pre-ordered after the middle of the first day were projected to be available in October. Second, we noted 1.25 days of Apple Retail inventory compared to 2.5 days during the 4S launch. Our 8 million estimate assumed full weekend availability and the counting of all online pre-orders. We believe that if supply were not a constraint and Apple included all pre-orders, the launch weekend number would have been closer to 7-8 million, assuming ~1 million October pre-order sales and an additional 1-2 million units at retail.

Wells Fargo analyst Maynard Um said:

Apple announced it has sold over 5 million iPhone 5s in the opening weekend, which exceeds the prior record of over 4 million sold when iPhone 4S was launched last October. However, Apple also noted that “while the majority of pre-orders have been shipped to customers,
many are scheduled to be shipped in October.” We believe this will cause some concern with regard to total iPhone 5 units in the September quarter, which we think expectations reached as high as 10 million units. We would note that (1) Apple will have 20 more country launches this Friday (9/28), where, based on our interpretation, means there have been no iPhone 5s sold yet in those countries (though Apple should recognize these as revenue because of its sell-in recognition policy), (2) our expectation was lower and also incorporated lower iPhone 4S sales due to the 5 launch (hence, we still believe there is upside potential to our estimates), and (3) while it may make sense to assume units
below 6 million units sold over the first three days (the interpretation of “over 5 million” sold), Apple has, in the past, also been conservative in its interpretation.

Barclays analyst Ben Reitzes said:

While our weekend checks suggested very robust demand, we witnessed very limited supply. First, nearly all the retail stores and carriers we canvassed reported no inventory. We believe initial shipments were very limited – with some non-Apple stores receiving below 20 iPhone 5’s. Second, our conversations also suggested inventories were almost fully depleted within the first few hours of operation on Friday. Third, we believe Apple is struggling to keep up with demand and guidance on new shipments remains vague or non-existent. Customers were being advised that it could take 2-3 additional weeks to receive the phone at this point which is consistent with today’s release. We believe this could be a result of 1) an expanded launch, as Apple included Hong Kong and Singapore 2) extremely robust demand and probably most importantly 3) in-cell supply constraints.


More: iPhone 5 16GB costs an estimated $207 to build | 5 reasons I'm passing on the iPhone 5 | First round of iPhone 5 reviews hit the Web | All iPhone coverage | A unique upgrade cycle

Topics: Mobility, iPhone, Smartphones

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  • Email addresses fro Apple employees

    My wife and I bought Apple 4’s when they came out, after only one month my wife’s iPhone stopped working. I contacted Apple many many times and it took more than 6 weeks to finally have Apple to repair the phone free of charge even though it was under their so called warranty.
    I was given very bad information by the Apple employees for the repair for the phone and the arrogance I received exceeded anything I have been submitted to by any other company in this world.
    Have you ever tried to contact Apple via email? Virtually impossible as no Apple email address can be found on the net except
    I contacted them with my story about the treatment I received and then I finally got some emails out of Apple.
    If you want to really let Apple know how you feel about these injustices done by this arrogant company then contact these people:
    Jayesh Kamath Janine Beach Frank Teo Shelley Reid
    Dewi Thompson
    • People are waiting for WP8

      That's what the sales # tells us.
      • Sincere flattery

        That's what he said. Why repeat it?
        Robert Hahn
        • Microsoft EMPLOYEES are waiting for WP8

          ... the rest of us a laughing and holding our noses.
      • And when WP 8 salesdon't come up to much more than the1.2million

        between the ones Microsoft will buy, and the rabid diehards (Miller/bottom/Farrel claims that he will but three, or more, to show his love of Microsoft). The sad part is that will be over a quarter, as opposed to 5 million over a weekend.
        Troll Hunter J
      • If the Foxconn riots continue

        that's all you'll be able to buy. :)
        William Farrel
        • Clearly they are rioting because

          They are being forces to make W8 kit. But then, who knows, it could be because of an attack of giant purple asparagii too.
        • foxconn make nokia, sony etc phones

          not only apple kit. foxconn also make xbox, dell, nintendo etc
    • Did you actually

      Make an appointment, go to a store and take your phone to the Genius Bar or did you just throw around emails, and expect them to come to your home and fix your phone on the spot? I owned an IPhone 4 (Now a TMobile G A 2) I had a problem, made an appointment, went there, and exchanged it since it wasnt easily repairable. Everything worked fine and went smooth.
      • what if you live 500 miles from nearest genius bar

        hypothetical, but the genius bar model works only for people in big cities.
    • Same for 3GS

      My 3GS went back for repair 3 times in the first 7 weeks, each time Apple kept it for 2 weeks. I had to make do with an old Samsung flip-phone as a surrogate.

      htc on the other hand replace my Mozart on the spot.
      • You have to figure

        That you're phone is not the only one being repaired. I love my country but this whole instant gratification crap has to go with the majority of us, not all. If you made an apt on the apple site and went to the store, they would of swapped it for another one unless able to fix on the spot. Had my Iphone 4 replaced twice cause of charging issues. Same day. Don't mail it in, they will have it for a period of time.
        • Quality

          Sorry, instant gratification? If I buy a new device, I expect it to work! I don't expect to have to spend my time driving into town and giving it back every couple of weeks!

          The phone would randomly turn itself off and wouldn't let itself be turned back on. The first two times, at the end of two weeks, it was returned with "no defect found." WTF? In the end, I spoke very loudly to a sheepish looking rep in a crowded store and said that it had now been returned for repair twice, without them finding the defect, I wanted a new phone.

          Surprise, surprise, when I came back to collect the phone 2 weeks later, they had magically "found" the defect and had swapped the phone out.
      • Interesting

        In my house we've had a total of 4 iPhones - my wife, daughter, and I all had iPhone 3G devices and I upgraded my iPhone to an iPhone 4. Out of those 4 the only one that had an issue was my wife's 3G which had a flaky Wifi radio - the Apple Store replaced it on the spot.
        • Never use facts

          It ruins the Troll's rant. I was even able to return a 6 hour old Lumia, because the screen shattered. Too bad the replacement phone had a purple hue to it, when turned down below 80% brightness. So the lie abput it taking 6 weeks is just that a lie. I'm thinking he's confusing it with the six to fourteen weeks it took to get a refurbished X-box 360, when it gt the RRoD....
          Troll Hunter J
        • Apple's service

          in Germany is pretty lousy. At the time, there weren't any stores, you had to take it to a normal retailer and wait for it to be sent back to Apple. They now have a couple of stores here, although the nearest one is about 4 hours away.
    • That never happened

      If you go to the Apple Store with a defective phone, they replace it on the spot.
      • How do you know?

        Were you there with him and his wife when they bought the phones? No? Perhaps they were ordered online from Apple...
        • How I know

          Because Apple has consistently the best customer service and this is their SOP.
          • Really?

            Like when apple instructed their store employees to deceive customers about infections on their macs when they are brought in for service?

            Lets not pretend Apple (or any company) can and wont do any wrong to customers.