Among the questions about the iPhone 7 is whether it can keep pace with the early sales of its predecessors. Apple Inc. (NASDAQ: AAPL) did not release sales for the first weekend, or week, as it has traditionally. That leaves investors and the media to look to other sources. According to one, iPhone 7 sales have matched those of iPhone 6 over the first week each was on sale.
In a Localytics research paper titled “After First Weekend of Sales, iPhone 7 & 7 Plus Show Similar Adoption to Previous Models,” the author wrote:
Comparing first weekend adoption of the ‘7’ models to previous models shows little difference. The iPhone 7 matched the iPhone 6S with 1% adoption after the first weekend, but both were behind the iPhone 6 which grabbed 2% in its first weekend. The iPhone 7 Plus had a similar first weekend to previous ‘Plus’ models with 0.2% market share as opposed to 0.3% for both the 6 Plus and 6S Plus.
Also:
Even though the early adoption is similar, predictions are that the iPhone 7 will bring more growth for Apple than the previous 6 models. Given that all iPhone 7 models and the jet-black version of the iPhone 7 Plus sold out in pre-orders, there is a demand for these models that was not seen in previous years.
Shareholders should be relieved. Many analysts expect iPhone sales to hit 70 million units the balance of the year. The huge run up in Apple shares is largely based on that analysis. Recently, Barron’s reported Citigroup’s Jim Suva’s analysis.
iPhone 7 expectations remain tempered (given marginal improvements relative to its predecessor) with September/December iPhone consensus units -8%/-1% y/y growth with iPhone 8 (OLED screens) phones in 2017 likely to spur further upgrades by the install base. We are modeling total iPhone units in September of 44.2m (-8%y/y, +10% q/q) and in December 73.9m (-1% y/y, +67% q/q). Each 1m iPhone units represents approximately $0.05 of EPS.
Those numbers are at the high end of expectations.
So, if bullish numbers are right, early adoption will be followed by impressive mass sales.
Methodology: For its study, Localytics examined over 70 million iOS devices. For the iPhone adoption data, it examined the relative percentage of iPhones in the first weekend after each device’s release. The iOS report was created by analyzing all devices eligible for an OS upgrade, excluding iPhones that automatically included the new OS version on the device.
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