SAN FRANCISCO -- Shares of
jumped sharply Tuesday, enjoying a boost from a report that iPhone sales will outpace estimates.
Market research firm iSuppli expects Apple to sell nearly 4.5 million iPhones this year and 13.5 million in 2008. This exceeds Apple's own goal of selling 10 million by the end of next year. In the following years, iSuppli expects iPhone sales to grow faster than the overall market for high-end phones with multimedia features.
Apple shares were recently trading up $4.47, or more than 3%, to $142.95.
Although it was released only a few months ago, the iPhone has become integral to forecasts for Apple's short-term growth. Investors and analysts have already baked blockbuster sales into their estimates of Apple's sales and profits. They expect the iPhone to become Apple's third powerhouse franchise alongside the iMac line of personal computers and the iPod.
Since the iPhone went on sale in late June, Apple's stock has risen almost 20%. Apple expects to begin selling the iPhone in Europe in the current quarter.
Apple's fourth-quarter earnings will be the first full quarter of iPhone sales and will show investors how the device can affect the company's overall profitability. Apple is reportedly receiving generous one-time and recurring fees from
, the exclusive iPhone server provider.
Device sales, however, are recorded piecemeal over a two-year period to reflect additional features that Apple will offer iPhone users free of charge.
Adding to the iPhone buzz, Apple is set to release a new product at a company event on Wednesday in San Francisco. Investors and industry insiders are betting that the company will unveil a new iPod. New versions of the portable music device may have Wi-Fi wireless Internet access and run on Apple's latest operating system.