An analyst with UBS has predicted a drop in the sales of the iPhone and the iPad, hinting at the possibility of Apple having to face some challenges around the months of March, June and September in the coming year.
As indicated by Steven Milunovich, the analyst with USB, a possible fall in the sales of the iPhone by 5 million units in every quarter of the coming year is expected. Similarly, the iPad sales may go down by 2 million units in every quarter. As per Milunovich’s estimates, Apple may belooking at selling 41 million iPhones in the first quarter, 36 million in the second quarter and 33 million in the third quarter. As for the iPad, Milunovich predicts the sale of 21.7 million units in the first quarter, 24.5 million in the second quarter and 20.7 million in the third quarter. Apart from the sales, Milunovich also predicted a fall in Apple’s earnings for the year 2013 and 2014. The stock’s target price has also been lowered from $780 to $700. Earlier, Peter Misek, an analyst with Jefferies, had cut Apple’s target price from $900 to $800.
Milunovich has cited a few reasons for his predictions. A check with the supply chains indicates a fall in the rate of manufacturing of the iPhone for the March quarter, bringing it down to 25 million units. Though the sales of the iPhone 5 have just begun in China, they may not match up with the sales of the iPhone 4S. However, China Mobile is soon expected to start selling the iPhone 5, which may bring greater sales. Milunovich also pointed out that the iPad Mini may be cannibalizing market share from the larger 9.7 inch iPad, leading to reduced manufacturing and shipment of these devices.
On the optimistic side, Milunovich admits that Apple, which currently enjoys substantial market share in the smartphone and tablet market, can be expected to bounce back next year with greater innovation. However, of late the company has been heavily challenged by Samsung’s Galaxy series of phones and other smartphones and tablets running on Android. Other challenges highlighted included the terrible timing of the iPad Mini and the newest iPad, which fell only a few months after the release of the previous generation iPad. This move is expected to have hurt Apple’s sales in the holiday season.
