More than 5 million iPhone 5s were sold in the first three days, surpassing a record set last year by the previous model, Cupertino, California-based Apple said today in a statement. Apple said demand for the new handset continued to exceed the initial supply, an issue the company cited last week as the cause of delivery delays for some early online orders.
Shares slipped amid concern that supply shortfalls may impede the company from harnessing the iPhone 5 to outpace rivals including Samsung Electronics Co. (005930) that make handsets using Google Inc. (GOOG)’s Android mobile software. The iPhone, responsible for about two-thirds of profit, is crucial to fueling the growth (AAPL) that transformed Apple from a niche computer maker into the world’s most valuable company.
“The number is lower than what people had expected,” Brian White, an analyst at Topeka Capital Markets, said in an interview. He had estimated debut weekend sales of 6 million to 6.5 million units, excluding Internet purchases that haven’t been shipped. “This seems to be driven more by availability than demand.”
The shares fell 1.3 percent to $690.79 at the close in New York. The stock has gained 71 percent this year.
The shortfall between iPhones actually sold and the tally predicted by analysts may not be vast, since Apple doesn’t report orders that were received over the Internet until they are delivered, Brian Marshall, an analyst at ISI Group, wrote in a note to clients today. Apple’s figure includes sales from wireless carriers, retail outlets, Apple stores and online orders that customers have received, he said.
“Units in transit could be in the millions currently,” Marshall said. He had anticipated sales of 6 million to 8 million units, based on his understanding of which orders Apple would count as sales.
Trudy Muller, an Apple spokeswoman, declined to comment beyond the company’s statement and referred to regulatory filings for the revenue-recognition policy. Apple counts online sales to individuals once the product is received, filings show.
Gene Munster, an analyst at Piper Jaffray Cos. (PJC), had predicted Apple would sell 6 million to 10 million of the iPhone 5. That assumed Apple would count all orders, including undelivered online purchases, in the sales reported today, Munster wrote in a research report.
Early orders in Apple’s online store topped 2 million units in one day, Apple said on Sept. 17. The company said in the statement today that “while the majority of pre-orders have been shipped to customers, many are scheduled to be shipped in October.”