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The first read on Apple’s smartphone sales following the launch of the iPhone 12 has come in – as I had anticipated in my weekly preview. Providing the insights was famed Apple analyst Ming-Chi Kuo, from TF International Securities.

The observations are not clearly and overwhelmingly positive, so it is worth dissecting the data with a bit more care. Here is what Ming-Chi Kuo reports:

  • First day iPhone 12 preorders totaled up to 2 million, up from the 800,000 units for the iPhone 11 in the comparable period last year.
  • The analyst estimated Apple would achieve 9 million iPhone 12 units over the first full weekend of preorders, down from the 12 million units for the same period in 2019.
  • China represented 35-45% of the iPhone 12 Pro sales, since the country has a more robust 5G network in place.

iPhone 12: better than I expected

First, let me make it clear that these number are not official, so they could be incorrect. Assuming that they are close enough to actual sales figures, I believe that the performance of the iPhone 12 out of the gate has been good, even better than I expected.

The first bullet point above is clearly positive. But also, notice that the iPhone 12 was launched more than one month later in the year, compared to the iPhone 11. Therefore, it makes sense to me that pent up demand from consumers that had been anticipating the new model for longer would have pushed first-day orders higher.

The second bullet point above seems less optimistic. However, keep in mind that the Mini and Pro Max versions will not be available for preorder until November. So, considering that weekend preorders of the iPhone 12 are expected to reach three-fourths of the comparable iPhone 11 numbers, even though the Mini and Pro Max are not even in the market yet, I see the weekend forecast as good news.

Lastly, the third bullet suggests that the iPhone 12 could unleash a revival in Greater China revenues in fiscal 2021. Certainly, selling more smartphones in one country versus another should not make much of a difference to Apple’s financial results. But don’t forget the impact of sentiment on the stock. Should Apple post strong iPhone sales out of a struggling Greater China region, investors could turn more optimistic and bid up the share price.

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