Apple's iPad sales in the December quarter look to be lower than expected amid the popularity of Amazon's Kindle Fire as well as its own MacBook Air.
Sterne Agee analyst Shaw Wu said in a research note that the iPad is seeing competition from two areas---the Kindle Fire and the MacBook Air. As a result, Wu cut his December quarter iPad sales estimate to 13.5 million from 15 million.
Obviously, Apple isn't going to sweat losing iPad sales to the MacBook Air, but the development is worth noting. Wu also appears to be the latest analyst to indicate that the Kindle Fire is a threat to the iPad.
Apple's iPad sales have been a hot topic in recent months. Worries began to surface in September and then the concerns appeared to be overblown after Apple deployed some "pricing stimulus."
Wu wrote in a research note:
In the Mac business, we are seeing particular strength in the MacBook Air, arguably the best ultra-mobile PC on the market. Last but not least, iPads appear a little light of expectations due in part to competition from Amazon’s Kindle Fire but also as some users opt for a more full-featured MacBook Air.
If this MacBook Air vs. iPad theme plays out, the tablet comparison to the tablet is going to be more interesting. It has been widely assumed that tablets will trump laptops, but if Apple customers are opting for a MacBook Air over the iPad perhaps limitations matter. Meanwhile, Intel's ultrabook movement could also make a dent in tablet sales. As ultrabook prices fall, they will be seen as direct substitutes for tablets assuming static pricing trends.
Bottom line: Maybe we shouldn't count out PC sales just yet.
As for Apple, light iPad sales may not be much to worry about for the simple reason that the iPhone is carrying the team. Wu said:
iPhone momentum is being driven by the company’s new flagship 4S as well as lower price points on its iPhone 4 and 3GS. This is helping drive greater smart phone adoption as well as enabling share gains against Android and BlackBerry (as evidenced with both HTC and RIM missing numbers). Our supplier checks indicate much improved production capacity but demand continues to outstrip supply.
Wu now sees Apple moving 28 million iPhones in the December quarter, up from his previous projection of 26 million. Wu estimates that 5.2 million Macs will be sold up from his outlook of 5 million.