Were Apple's iPhone Sales 'Crappy'? Henry Blodget Thinks So

NEW YORK ( TheStreet) -- Tuesday on TheStreet, I chided Wall Street analysts for their role in the iPhone 5-related dive in Apple's ( AAPL) stock price.

I was unfair, but only to the extent that I unintentionally exonerated the media from its share of the blame.

The hype surrounding this story showcased -- and, sadly, continues to showcase -- everything that is wrong with the smash-and-grab 24-hour news cycle.

I believe in being provocative, in bringing entertainment value alongside investment value and unique perspectives on the news. That's all good. But, above all else, I shoot straight.

For instance, my first reaction to news that Apple "missed" iPhone 5 estimates was not that they "missed," but that irresponsible Wall Street analysts who produce unscientific and unreliable projections deserve flack for bigger picture problems in the dysfunctional analyst-media-stock market relationship.

For better, but usually for worse, the media eats analyst conjecture up.

This unfortunate tradition of taking seriously the numbers analysts pull out of the air leads us to the absurd territory of being let down when Apple sells, at minimum, 5 million phones in one weekend!

And, if you're Henry Blodget at Business Insider, you can be all over the place on the issue. While you're there, you can take a well-regarded partner like Bloomberg into the mud with you.

Here's a Tuesday morning Tweet from Blodget:

Follow me here.

Blodget teases a story by referring to iPhone sales as "crappy."

Let's start with what's wrong with that.

First, they weren't crappy. If they were, I guess his characterization would have been fine. But, they weren't.

The number, including preorders, might have been more than seven million. And, by now, who knows how high it's gone? So Henry, please tell us, what the hell were you talking about when you said sales were "crappy?"

What makes things even worse is that Blodget uses the disingenuous "crappy" line to lead into a story that absolutely does not reflect the tone of his tease. When you open the link, you come to a Business Insider-hosted version of this relatively tame Bloomberg story titled, "Apple iPhone 5's Thin Display Drives Supply Shortfall."

Typical Bloomberg there. Strong, solid, straightforward reporting. I can't imagine Bloomberg appreciates Blodget using its story to slum on Twitter.

We can only speculate on Apple's iPhone sales from the weekend and where they are now. One thing, however, cannot be more clear. It's pathetic to categorize record-breaking sales of at least 5 million in a few days as "crappy."

Because, if you read the Bloomberg story, and actually consider the reality of the situation, no sane and logical person could actually come to a conclusion that even includes "crappy" in it.

It seems to me that Apple ran out of iPhones. As bearish as I am on Apple's future prospects without Steve Jobs and with Tim Cook, I am not crazy.

One of Cook's best-known skills is that he is a master of the supply chain. He likely sat in meetings or on conference calls where he asked directly, "What's the deal with this touchscreen component? How will this impact production?"

Maybe he was told what the people in the room thought he wanted to hear. Maybe he erred in believing it. And, now, Apple cannot meet demand. Maybe he knew all along what would happen if sales paced ahead of iPhone 4 and iPhone 4s. Maybe he had that classic Apple press release written months ago:
"Demand for iPhone 5 has been incredible and we are working hard to get an iPhone 5 into the hands of every customer who wants one as quickly as possible," said Tim Cook, Apple's CEO. "While we have sold out of our initial supply, stores continue to receive iPhone 5 shipments regularly and customers can continue to order online and receive an estimated delivery date. We appreciate everyone's patience and are working hard to build enough iPhone 5s for everyone."

Maybe Cook is playing us all. He knew what was about to happen. And he has created unprecedented pent-up demand for iPhone 5 heading into the two most important quarters in his time as CEO. If this is the case, he's walking a fine line with customers, no doubt. But, one thing he absolutely did not do is produce "crappy" sales.

At the time of publication, the author held no positions in any of the stocks mentioned in this article.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Rocco Pendola is a private investor with nearly 20 years experience in various forms of media, ranging from radio to print. His work has appeared in academic journals as well as dozens of online and offline publications. He uses his broad experience to help inform his coverage of the stock market, primarily in the technology, Internet and new media spaces. He has taken a long-term approach to investing, focusing on dividend-paying stocks, since he opened his first account as a teenager. Pendola, 37, is based in Santa Monica, Calif., where he lives with his wife and child.