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How Apple Is Going to Give the iPhone a Boost

NEW YORK (TheStreet) -- It's no secret that Apple's (AAPL - Get Report) largest driver of sales and income is the iPhone, as it shipped 43.7 million of the devices last quarter. Yet, with Apple going into a seasonally slow period ahead of the upcoming iPhone refresh, Apple is planning a massive promotion to give its leading man a little help.

According to 9to5Mac, (and the world's best Apple reporter, Mark Gurman), Apple will be instituting an event this week at its Apple Retail Stores, starting May 8, and contacting iPhone users who are eligible for an upgrade to come in and update their phones to Apple's latest offerings. The report states Apple will be sending out emails to users.

Apple could not be immediately reached for comment for this story.

The program is expected to take place throughout the United States, in multiple states, and will likely be the first big project that new Apple executive Angela Ahrendts oversees as Senior Vice President of Retail and Online Stores.

Ahrendts, who officially started earlier this month, was scooped up by Apple last year to take over its Retail Stores, which had previously been led by John Browett, one of CEO's Timothy D. Cook's first major hirings. Browett took over from Ron Johnson, who had left the job to become CEO of J.C. Penney (JCP) in an unsuccessful transition.

The push to boost iPhones in a seasonally slow period comes after Apple shipped 43.7 million iPhones in its fiscal second quarter, on its way to generating $45.6 billion in revenue. Analysts were expecting around 37 million iPhones shipped, though Apple easily surpassed that number due to strength in foreign countries. "We gained smartphone share in many developed and emerging markets including the U.S., the UK, Japan, Canada, Germany, France, Vietnam and Greater China, just to mention a few," Cook said on the earnings call. "In fact, we established a new all-time record for total iPhone sales in the BRIC countries."

Apple is expected to unveil a new iPhone, already dubbed the iPhone Air, later this year, coming in two sizes, a 4.7-inch version, and a 5.5-inch version.

Analysts have suggested that Apple could sell the larger iPhone at a higher price point than the current 4-inch version, perhaps as much as $299 on contract. In a March research note, Pacific Crest Securities analyst Andy Hargreaves wrote, "We believe Apple can sell a 4.7" iPhone at a subsidized price of $299, which should generate incremental gross profit on replacement sales and attract new customers that had previously purchased Android phones specifically for a larger screen."



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