Apple iPhone Stumbles Out of the Gate
Investors have been enthusiastic about Apple's prospects in the wake of the iPhone's introduction last month, and many on Wall Street were eagerly anticipating AT&T's update on activations of the new device. Apple introduced the iPhone the evening of June 29, so it was understood that AT&T's figures -- which cover the second quarter ended June 30 -- would reflect just a day and a half worth of sales.
Even so, the San Antonio telco's announcement Tuesday morning that it had activated a total of 146,000 iPhones on June 29 and 30 was met with something less than enthusiasm. Apple fans and industry analysts had been looking for about double that number.
Some iPhone customers did experience troubles activating their phones during the first few days of the debut. That may account for the some of the lower-than-expected tally from AT&T.The iPhone did not fully sell out during the first week of the introduction, causing some disappointment among the most optimistic observers. As TheStreet.com reported earlier this month, Apple's best-case-scenario goal or whisper number was to sell out the 1 million iPhones that the company was prepared to supply, said sources familiar with the plan. Apple will report the actual number of iPhones it sold when it presents its earnings after the market closes Wednesday. The company is expected to report two categories related to the iPhone: the number of units sold, and a portion of the revenue, which is going to be booked over a two year contract period. It's not likely that AT&T's iPhone number will be the same as Apple's. Merrill Lynch analysts expect Apple to report that it sold "at least a couple hundred thousand units at launch." Early Tuesday, Apple fell $5.25 to $138.45 and AT&T slipped 32 cents to $39.76.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV