iPhone 3GS wknd. analysis

Apple's first weekend for the iPhone 3G S was impressive, but it may not foretell future prospects, analysts comment. Maynard Um of UBS observes that the 1 million in units was "likely better than expected," backing survey results from Friday. The analyst continues to call for 4.55 million in iPhone shipments by the end of the June quarter, but says the number "may prove conservative" given launch performance.

In the long run sales are expected slide in favor of the 8GB iPhone 3G, which may be more attractive at $99. Low margins on the phone could affect Apple's profits; a bigger concern is said to be the global recession, which is not only pushing people towards cheaper products, but also deterring them from buying unnecessary goods in the first place. Demand may ultimately be capped by excessive data fees, says Um.

Kaufman Bros.' Shaw Wu meanwhile notes that the 1 million figure is "a bit higher" than the 600,000 he previously predicted, and a good sign considering the threat of recession and a smaller number of launch countries, measured at eight instead of the 21 for the iPhone 3G. The analyst is holding to shipment projections of 3.8 million for the June quarter however, on the basis of checks showing a drawdown in inventory and "customer pause" before the announcement of the 3G S. The company is ultimately expected to thrive because of strategic advantages, such as vertically-integrated product lines.

by MacNN Staff