CUPERTINO, Calif. (TheStreet) -- Take a step back from all the brouhaha surrounding pre-ordering problems with the new iPhone 4, and the deluge of demand clearly spells good news for Apple (AAPL) and its investors.
"Despite the glitches yesterday, we believe demand was strong as pre-orders and reservations for the June 24th launch day are now sold-out," explained Maynard Um, an analyst at UBS Investment Research, in a note released on Wednesday. "We expect the iPhone 4 launch to be larger than the iPhone 3GS launch last year which sold 1 million units in its first three days."
Um feels that Apple could even have reached the million mark yesterday, potentially driving up Apple's quarterly iPhone numbers. "Our iPhone unit estimates could prove conservative as we estimate 8 million units," he added.
Investors were certainly warming to the new iPhone Wednesday. Apple shares rose $6.48, or 2.5%, to $266.17, far outpacing the modest advance in tech stocks that saw the Nasdaq rise 0.16%.During Apple's recent second-quarter results, iPhone shipments climbed a massive 131% compared to the same period last year, reaching 8.75 million devices. iPhone revenue also rose dramatically, reaching $5.45 billion, compared to $2.43 billion in prior year's quarter. iPhone sales now account for around 40% of Apple's total revenue. Um, who rates Apple a buy with a price target of $320, also says that 100,000 iPhone shipments are worth around 2 cents to the tech giant's earnings per share. A spokesman for AT&T (T) confirmed to TheStreet that iPhone 4 pre-order sales were 10-times higher than the first day of pre-ordering for the iPhone 3GS, and explained that there is massive interest in upgrading to the new phone. "In addition to unprecedented pre-order sales, yesterday there were more than 13 million visits to AT&T's website where customers can check to see if they are eligible to upgrade to a new phone," he wrote, in an email. "That number is about 3-times higher than the previous record for eligibility upgrade checks in one day." It's well-known now that the huge demand crippled AT&T's Web site; it was forced to suspend iPhone 4 pre-orders Wednesday, just a day after the telecom giant began taking the online orders. Apple has also been swamped with demand, and its Web site now says that it will ship the new iPhone by July 2, more than a week after general availability on June 24. -- Reported by James Rogers in New York
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