Apple Inc. (NASDAQ:AAPL) is expected to unveil its long-awaited iWatch later on this year, and it is expected to be a big hit. USB analyst Steven Milunovich shared a note with investors today saying that that the iWatch alone could add one or two points of earnings per share growth.
Big expectations for Apple’s iWatch
He added that Apple Inc. (NASDAQ:AAPL) may achieve product margins starting at launch of about 25% with an increase to the low 30s over a few quarters. Milunovich added in his note that Apple will likely launch the iWatch right before the holiday shopping season.
Apple Inc. (NASDAQ:AAPL)’s first iPhone only sold about 5.4 million units within the first year. The first iPad got off to a better start with total sales of 19.5 million units in the first year. He predicts iWatch sales to track iPad sales. It is also possible the iWatch could do better in terms of sales simply because the initial customer base is larger. However, it is also important to point out the iWatch may need to win over customers before it can become a huge success.
What fans hope for
The iWatch is definitely a gadget to keep an eye on. Many other tech companies have come up with their own versions of smartwatches, including Apple’s biggest rival Samsung. Despite the various smartwatches currently on the market, Apple Inc. (NASDAQ:AAPL)’s version is the device everyone is talking about.
The iWatch most likely won’t debut until the latter portion of the year, however, fans did get a glimpse last week of the iOS 8 and the HeathKit feature. There was no mention of the iWatch during the event, but the new operating system is almost certainly designed for use with both the new iPhone and iWatch. The fact that smartwatches are a huge trend now means Apple can make a big splash if they can jump on the trend with a top notch product.