iPhone 5 Remains The Choice Of Consumers, Despite Apple Maps Woes

iPhone 5 Remains The Choice Of Consumers, Despite Apple Maps Woes
JESHOOTS / Pixabay

Apple’s supply of iPhone 5 units couldn’t hold up to the weekend demand, and what many analysts forecast as one of the reasons behind this demand, is the use of new thinner display.

iPhone 5 Remains The Choice Of Consumers, Despite Apple Maps Woes

However, according to ‘Apple Gurus’, Gene Munster and Douglas J. Clinton, of Piper Jaffray, there are three points to consider around the iPhone 5 for December. First, they do not currently expect supply issues that would limit the 49 million estimate for the quarter. The two analysts from firm continue to believe that by December, supply and demand for the phone should be close to equilibrium. Second, if supply issues do constrain December, analysts do not believe consumers will “give up” on the iPhone in favor of another phone. Third, consumer sentiment on the iPhone remains high, despite reported issues with Apple Maps, which suggests that the Maps product is not causing a user backlash.

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Tha above three points discussed in detail:

Continue To Expect 49 Million iPhones In December:

Analysts from Piper Jaffray believe that despite some worries about supply chain constraints, Apple Inc. (NASDAQ:AAPL) is continuing to build as many phones as it can, in order to meet demand. They remain confident that supply and demand will be closer to equilibrium toward the month of December, which would be a slightly longer time period to meet demand than for the iPhone 5 launch. In a recent survey of 20 Apple Inc. (NASDAQ:AAPL) Stores, the research firm noted that only 4 stores in smaller cities had any iPhones available, and those available were all for Sprint Nextel Corporation (NYSE:S). It appears that inventory continues to trickle into retailers, but demand remains high.

Survey Work Suggests Consumers Want iPhones:

Piper Jaffray’s smartphone survey from the summer indicated that 65% of consumers intended to buy an iPhone for their next phone. Additionally, 94% of Apple Inc. (NASDAQ:AAPL)’s iPhone owners were planning on buying another iPhone. In a more recent survey of 1,000 consumers online, 35% of consumers hope to get a smartphone for the upcoming holiday. Of those consumers, about 63% hoped to get an iPhone. Analysts from the research firm note that this survey was conducted prior to the launch of the iPhone 5, and thus the percentage is now likely higher. They believe that given desire for the iPhone, it is unlikely that consumers will opt for a different smartphone, instead of waiting for an iPhone. Therefore, if there were a supply issue for December, it would result in significant lost units.

Consumer Sentiment On iPhone Remains High:

Consumer reaction to the iPhone 5 post announcement was significantly better than it was for iPhone 4S. For the iPhone 5 in the week after its announcement, 71% of tweets were positive, compared to 49% for the iPhone 4S, according to Investing Analytics. For the past week since the iPhone 5 began selling, analysts note that the positive sentiment on the phone has increased to 73% of tweets. According to analysts, it is important, despite some negative reviews about the Apple Maps product. The bottom line is that consumers do not seem to be overly concerned about the shortcomings of Maps.

Piper Jaffray remains firm on their “Buy” rating of Apple Inc. (NASDAQ:AAPL), and reiterate the $910 price target.

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