Disappointing iPhone sales? Hardly
Here’s what the iPhone didn’t do during its opening weekend of sales:
- It didn’t meet the exuberant sales forecasts of analysts, some of whom seemingly were plucking figures out of thin air;
- It failed to cure dropsy, cholera, and river blindness;
- It did not make anyone who carried it around noticeably more handsome.
As disappointing as those realities may be—and believe you me, that third one causes tears to stream down my not noticeably more handsome face—here’s something else the iPhone didn’t do during its opening weekend of sales:
- It did not—despite what over-eager headline writers may suggest— fail, stumble, or otherwise portend Apple’s doom.
The reality of the situation is this: Apple sold 270,000 iPhones during its fiscal third quarter. More accurately, Apple sold 270,000 iPhones during the 30 hours of its fiscal third quarter in which the mobile phone was actually on the market. Or to put it another way, from 6 p.m. Eastern on June 29, up until the clock struck midnight to usher in July 1, 150 people were buying an iPhone every minute. Impressive or not, it hardly conjures up images of tumbleweeds blowing through Apple Stores during that opening weekend.
And let’s consider for a moment who’s not included in that 270,000 sales figure: anyone who waited until Sunday to buy an iPhone; anyone who decided to wait out the opening weekend crowds and pick up the phone a week or so after it shipped; and folks who wanted to read a review or two before they decided to buy an iPhone. The sales needle didn’t hit 270,000 and then stop.
Or as NPD director of analysis Ross Rubin told my colleague Jim Dalrymple, “This isn’t like a movie where the opening weekend is a strong predictor of overall success, and it’s not even like most retail products,” Rubin said. “The launch numbers are blunted because of the realities of most consumers considering a new phone only when their contracts are up.” Or to put it another way: Apple did not just have one shot at selling people an iPhone. As more consumers’ existing cell-phone contracts expire, more of them will consider buying an iPhone—and more than a few probably will.
And yet, somehow, this is considered in some quarters to be disappointing, presumably because the one-day-and-change sales figures failed to meet analysts’ forecasts that were, to be extremely charitable, overly exuberant. Those forecasts certainly weren’t based on any public guidance for Apple, which offered no iPhone sales predictions before this week outside of its stated goal to sell 10 million phones in 2008. Apple is sticking to that target, adding the expectation that it will sell its 1 millionth iPhone before the end of the September quarter. That’s not the sort of talk you’d expect from a company with a dud on its hands.
Something else to consider: While the iPhone has generated near-epic levels of hype and hoopla, Apple doesn’t exactly need to sell millions upon millions of iPhones right away. The company’s core Mac business is doing rather well—this was the best ever quarter for Mac sales in case you didn’t hear—and it’s also doing a brisk trade in iPod sales despite not coming out with any updated music players in nearly a year. It’s the Mac and the iPod that are fueling Apple’s success right now—the iPhone is a nice, little side business that has the potential to drive growth a little further down the road. Apple is getting into the phone business not out of desperation, but out of anticipation—it’s forward-thinking moves like this that keep a company strong long after the hype machine has moved on to its next whizzy pre-occupation.
To put it another way, if 270,000 iPhone sales in 30 hours for a business the figures to be a long-term boon for Apple somehow disappoints you, perhaps the problem isn’t with the iPhone. Maybe it’s just you.