Apple Inc. (NASDAQ:AAPL) won’t even put the iPhone 6 and 6 Plus up for preorder in China until Oct. 10, but already there are reports of a massive response. Chinese media outlets are saying that mobile carriers and some major retailers in China recorded 2 million reservations for the two new iPhones in just six hours.
Meanwhile analysts from multiple firms are weighing in on Apple’s iPhone 6 and 6 Plus potential in China.
China goes ga-ga for Apple’s iPhone 6, 6 Plus
Apple Insider spotted the Chinese media reports. Both Sina and ITHome reported that just six hours after opening preorders for Apple’s two new iPhones, Chinese carriers and retail outlets saw over 2 million orders. However, both websites also stated that they had “incomplete statistics.” The websites also reported that most of the preorders are for the 64 GB iPhone 6 and 6 Plus models instead of the lower models.
Apple said earlier this week that it would start online preorders for the two new iPhones on its Chinese website on Oct. 10. The company said Chinese buyers could reserve them for pickup in stores starting on Oct. 14 and actually pick them up starting on Oct. 17.
In addition, Chinese carriers and retailers were not supposed to start selling the two new iPhones until Oct. 17. Apparently they just couldn’t wait.
iPhone 6 success in China
In a report dated Sept. 30, 2014, Cantor Fitzgerald analysts Brian White and Isabel Zhu said their contacts in China assured them that Apple’s two iPhone 6 models would be “met with an insatiable appetite in China.”
They added that the majority of their contacts are planning to buy new iPhones, with 72% of them planning to buy one of the two new models this year and 28% not planning to do so. They think this shows how well Apple could do in China and the rest of Asia.
Apple and China Mobile
The Cantor Fitzgerald team also points out that this is the first time Apple is launching a new iPhone with China Mobile as one of the first carriers to have it in the country. They believe that this “opens up new growth vectors for Apple” in China.
They point out that China Mobile say its 4G subscribers swell to 29.6 million in August, an increase from 20.4 million in July. In addition, China’s largest carrier ended August with 796 million overall wireless subscribers, which is 63% of the nation’s total wireless subscribers.
China to drive growth for Apple
In their report dated Sept. 30, 2014, RBC Capital analysts Amit Daryanani and Mark Sue and their associates also chimed in on China Mobile. They think China will be a key driver in Apple’s December and March quarters.
Of course including China Mobile in the China launch is a big positive for Apple, as the company did not include the carrier at launch last year. They point out that the addition of China Mobile this year increases Apple’s total addressable market by about 95% compared to last year.
In addition, they think iPhone sales in the March quarter could receive a boost from Chinese New Year as well as pent-up demand for new iPhones. The RBC team also suggests that Apple’s margins could improve because they think China sales will be more skewed toward the larger and more expensive iPhone 6 Plus, which they think has a higher gross margin than the iPhone 6.
The RBC Capital team estimates that Apple will sell a total of 58.5 million iPhone units in the December quarter and 46.3 million units in the March quarter. They expect 13% of the total units will be sold to China in the December quarter and 19% of them for the March quarter.
