Apple could miss iPhone sales target by 20%, says analyst

Mon Feb 25 2008, 15:10 PM

Apple may sell 'only' 7.9m iPhones this year, more than 20% below its target of 10m, warns Bernstein analyst Toni Sacconaghi, quoted in Barron's. Sacconaghi's estimates are based on sales of the iPhone for Dec, when Apple sold about 180,000 iPhones per week. They also take into account seasonal factors and "particularly disappointing" European sales, where the iPhone is available in France, Germany and the UK. Sacconaghi is not the only one to cast doubts over iPhone sales. Overall, analysts identify two challenges: a demand that has failed to meet expectations, and the problem of unlocked iPhones, which are preventing Apple to cash in from revenue-sharing deals with network providers.

A few facts, however, should help skew the picture to Apple's favour. The iPhone is set to launch in more countries this year, notably in Asia and in Canada. Apple has also said that it would release new models that will work on 3G networks. These are deemed faster than the EDGE network, on which the iPhone currently runs.

Recent figures suggest that up to 1.3m iPhones could have been unlocked by users. China Mobile estimates that some 400,000 iPhone handsets were illegally activated on its network by the end of last year, although Apple has not yet officially launched the device in China.

Earlier this month, Orange claimed to have sold 90,000 iPhones since the handset launched in France on Nov 29. In the UK and Germany, where the device hit the market three weeks earlier, O2 and T-Mobile claimed to have sold 190,000 and 70,000 iPhones, respectively, by mid Jan.