Quick Note: Apple Sells 2 Million iPhone 5 Smartphones During Chinese Debut
December 17, 2012 9:17 AM
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Apple offers official candy sales figures for the first time
went on sale in China on December 14. Apple announced over the weekend that in only three days after that launch it has sold 2 million iPhone 5 smartphones. Apple also reasserted that the iPhone 5 would be available in more than 100 countries by the end of December marking the fastest iPhone rollout ever.
“Customer response to iPhone 5 in China has been incredible, setting a new record with the best first weekend sales ever in China,” said Tim Cook, Apple’s CEO. “China is a very important market for us and customers there cannot wait to get their hands on Apple products.”
Despite the successful rollout, Apple shares fell 3.8% in trading on Friday after the iPhone 5 debuted in China. Citi Research downgraded Apple stock from "buy" to "neutral" and lowered Apple's price target from $675 to $575.
Citi Research blamed diminishing hype for the iPhone 5 and improving competition in the smartphone market.
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12/17/2012 7:50:04 PM
Why does Apple think the Chinese market is important? I don't see how this helps them strategically.
The phones will be jailbroken, and the App Store will not see much, if any sales, and thus developers are not going to see much benefit. It is likely that there will be home brew iOS builds, just like other phones there.
I'm pretty sure Apple does not even support Chinese standards like WAPI for Wifi.
Apple won't get far using lawyers and the courts there either.
Is it important just for the stock market and American analysts? I wonder if Hong Kong numbers are being included for marketing reasons.
RE: Important market?
12/17/2012 10:09:47 PM
Maybe, but Apple still makes pretty good profits on each sale of hardware, so that's pretty good too. I don't know if that's the case with the iPhone 5, but that was certainly the case with previous iterations of the iPhone.
RE: Important market?
12/17/2012 11:17:40 PM
Apple doesn't really care that much about jailbroken phones because their income from iTunes and the App Store is peanuts. It is a drop in the bucket compared to every other product and service that they have.
They make money selling hardware. Selling movies, music, apps, etc, is not very profitable for Apple, Amazon, Microsoft, Google, anybody, because the lion's share of that sale goes to publishers and content creators. In the end the profit margins to hardware companies are only around 10%.
The people that get hurt the most by jailbreaking are developers, since piracy is one of the primary uses of sideloading apps. Losing app store income doesn't harm Apple very much at all, they make money from the phone itself.
Of course, the App Store indirectly makes money for Apple since it encourages people to buy into their hardware ecosystem and stay in it. Having such a great selection of applications adds value to the hardware, but in terms of direct profit it is all about the hardware to Apple
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