The success of Apple's iPhone may have peaked
29 December 2012

The success of Apple's iPhone may have peaked

Chinese sources do not expect the iPhone 5 to do as well as the iPhone 4S

There are concrete signs that Apple's iPhone success has reached it's peak. Shares of Apple were down more than 25% in November 2102 from September's high of $705.07 as investors began to panic about Apple’s future.

Apple's stock bounced back slightly since late November 2012, however a new report questioning Apple’s biggest money-earner is problematic. The money earning machine called the iPhone may have seen it's greatest success.

UBS analyst Steve Milunovich trimmed his estimates for Apple’s fiscal 2013 and fiscal 2014 years. He also dropped his price target on Apple shares to $700 from an earlier target of $780.

Steve trimmed his iPhone sales estimates by 5 million units this fiscal year, and iPad sales estimates were cut by 2 million units.

The most alarming part of Steve's note comes in the form of an observation from his supply chain sources. “Some of our Chinese sources do not expect the iPhone 5 to do as well as the iPhone 4S”.

The UBS analyst sees iPhone production dropping to 25 million units in the first calendar quarter next year, which doesn’t look good for June-quarter's (2013) sales. Apple could get an early pick-up in 2013, however, as earlier reports suggest Apple might launch a refreshed iPhone 5S in the summer of 2013.

Milunovich now sees Apple earning $47 per share in fiscal 2013, down from his earlier estimate of $51.50, and he believes fiscal 2014 earnings will total $55.85 per share, down from $62.

There are concrete signs that Apple's iPhone success has reached it's peak. Shares of Apple were down more than 25% in November 2102 from September's high of $705.07 as investors began to panic about Apple’s future.

Apple's stock bounced back slightly since late November 2012, however a new report questioning Apple’s biggest money-earner is problematic. The money earning machine called the iPhone may have seen it's greatest success.

UBS analyst Steve Milunovich trimmed his estimates for Apple’s fiscal 2013 and fiscal 2014 years. He also dropped his price target on Apple shares to $700 from an earlier target of $780.

Steve trimmed his iPhone sales estimates by 5 million units this fiscal year, and iPad sales estimates were cut by 2 million units.

The most alarming part of Steve's note comes in the form of an observation from his supply chain sources. “Some of our Chinese sources do not expect the iPhone 5 to do as well as the iPhone 4S”.

The UBS analyst sees iPhone production dropping to 25 million units in the first calendar quarter next year, which doesn’t look good for June-quarter's (2013) sales. Apple could get an early pick-up in 2013, however, as earlier reports suggest Apple might launch a refreshed iPhone 5S in the summer of 2013.

Milunovich now sees Apple earning $47 per share in fiscal 2013, down from his earlier estimate of $51.50, and he believes fiscal 2014 earnings will total $55.85 per share, down from $62.