Some analysts think Apple (NAS: AAPL) might end up "missing" this quarter with iPhone unit sales. The vast majority of mobile consumers are now well attuned to Apple's iDevice upgrade cycles, and plan their purchases accordingly.
Seasonality is for suckers
This means that iPhone sales typically drop off heading into the expected fall release of new models and, similarly, iPad sales should see some slowness leading up to its spring updates. Whether or not this was a grand scheme concocted by Steve Jobs and Tim Cook remains to be seen, but the very noticeable effect on Apple's business is that there's very little seasonality relative to other consumer electronics players.
Generally, consumer products companies are strongest in the calendar fourth quarter, thanks primarily to holiday spending, while summers tend to be slower. In comparison, Apple now gets a massive summer spike in revenue, thanks to the new iPad models it launches during the spring. Then, six months later, it gets a winter spike from the new iPhone, along with the normal holiday boost.
So, during various times of the year, the iPhone and iPad take turns in the revenue growth driver's seat. For example, this is what happened last summer after the iPad 2 launched, and everyone was waiting on the iPhone 4S unveiling.
Source: Earnings press releases. Calendar quarters shown.
The net result to the top line was that the second and third calendar quarters of 2011 saw greater sales ($28.6 billion and $28.3 billion, respectively) than the holiday fourth quarter of 2010 ($26.7 billion), breaking normal sales seasonality.
With the third-generation iPad being the biggest upgrade since the device's launch, we may very well have an iPad blowout on our hands.
How high can you go?
Needham analyst Charlie Wolf is now boosting his iPad estimates for this quarter, up to a whopping Street-high of 20 million units. That's up from his prior estimate of just 13.5 million iPads. Wolf cites a number of contributing factors, including adoption from all sorts of groups, including NFL teams, airlines, school districts domestically and abroad, doctors, the enterprise, and many more. Here's how that would look.
Source: Earnings press releases. Calendar quarters shown.
For some perspective, 20 million would be over twice the 9.2 million iPads sold a year ago. If Apple sees an average selling price, or ASP, of $600, then that's $12 billion in sales. That's in line with the cumulative lifetime ASP, but this has actually been trending down lately, $559 last quarter. With the iPad 2 still in production at a lower entry-level price, iPad ASPs will also continue downward. A $550 ASP turns into $11 billion in revenue.
And now, back to your regularly scheduled programming
In other iAnalyst news, Janney Capital Markets analyst Bill Choi is boosting his fiscal 2013 iPhone estimates to reflect the expectation of a major upgrade and redesigned form factor. Choi thinks the December quarter could see iPhone unit sales as high as a monstrous 50.2 million units, with 176 million for the fiscal year.
That's a solid 100 million more iPhones than the 72.2 million iPhones that Apple sold throughout fiscal 2011, or a 143% increase in two years. Those figures were boosted from previous estimates of 44.5 million iPhones in the December quarter, and 163 million iPhones in fiscal 2013.
Apple has already closed its fiscal third, and is now just crunching the numbers before letting them lose on July 24. As we start a new quarter, the real tablet question will be whether or not Google's (NAS: GOOG) new Nexus 7 gets a warm reception, which I think it will and, more importantly, whether or not that makes any type of dent in iPad sales.
The overall tablet market is growing so quickly that it's possible for the Nexus 7 to get a strong start and not impact the iPad meaningfully, especially as they play in different ends of the market. Amazon.com (NAS: AMZN) is bound to release a new pair of Kindle Fires. That's right, a pair, to take on both the Nexus 7 and the iPad. Farther out, a whole slew of Microsoft (NAS: MSFT) Windows 8 tablets will hit the market in the fourth quarter, just in time for the holiday shopping season.
However, of this I am certain: Apple will sell a lot more iPhones, a lot more iPads, and make a bunch of money this quarter. Our proprietary and highly scientific model (detailed on Pg. 7 of our S-1) predicts it.
Apple doesn't exhibit seasonality because its sales growth continues to skyrocket, yet it still has plenty of room to run. The Motley Fool has just launched a brand new premium Apple research service catering specifically to current or prospective Apple investors. Sign up now. Mobile computing is the next trillion-dollar revolution. Apple's just one of many ways to play, including this company that's powering a new generation of gadgets. This report is totally free.
The article Does Apple Have an iPad Blowout in Store? originally appeared on Fool.com.Fool contributor Evan Niuowns shares of Apple and Amazon.com, but he holds no other position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Microsoft and Amazon.com. The Fool owns shares of Apple. The Fool owns shares of Google. Motley Fool newsletter services have recommended buying shares of Microsoft, Google, Amazon.com, and Apple. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. Motley Fool newsletter services have recommended creating a bull call spread position in Microsoft. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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