Apple Inc. (NASDAQ:AAPL) slides down the market thanks to the uncertainty of investors. On early Tuesday morning, stock analysts claim that AT&T Inc. (NYSE:T) report of lower-than-expected iPhone sales could indicate a significant miss for the company.
The company reportedly activated 4.3 million iPhones during the last quarter. That number was significantly higher than last year’s first quarter report of 3.6 million, however the new number is said to be missing certain estimates. AT&T’s rival Verizon reported that they activated 3.2 million iPhones last quarter.
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Analysts from Jeffries & Company suggests that Apple’s stock is faltering because carrier subsidies are decreasing. AT&T was expected to activate 6 million iPhones during the first quarter- this indicates a loss of -43%. Furthermore, Verizon was expected to activate 4 million, while their actual number of 3.2 million indicated a loss of 24%.
I believe that Apple is at the top of their peak period right now and unfortunately, it may lead to a minor downfall. Once you reach the top of the staircase, you have nowhere else to go but down. I highly doubt that this means the beginning of the end for Apple, but I do think that the demand for certain products (like the iPhone 4s) has decreased slightly. It’s been about six months since the iPhone 4s was released and a large number of people already own one. Since many of the users are tied to a contract, they have to wait at least two years or less before they can buy another phone. Apple fans are also in limbo waiting for the arrival of the iPhone 5, which has yet to be seen.
I should also point out that Apple currently offers three different iPhone models: 3GS, 4, and 4S. Some people, those who are new to the iPhone may not feel like spending a small fortune on the latest model, especially when they can purchase one for almost nothing. Apple offers the iPhone 3GS for $0 with a 2-year AT&T contract. Why spend $199 on something you could get for free?