APPLE Inc may have sold as many as 425,000 of its new iPhones in the first three days after the handset made its debut, in line with projections even after a technical breakdown.
Apple and partner AT&T Inc sold a combined 225,000 devices in the United States, though a failure in Apple's system meant some buyers had to finish the activation at home, said Piper Jaffray & Co analyst, Gene Munster. The numbers matched his estimate, said Munster, who predicts Apple will sell 4.08 million this quarter.
"We thought it was going to be less because of the activation problems on the first day, but what we found is that virtually every store had a line and many stores were sold out," Munster told Bloomberg News. "The summary is that demand is good, execution was average."
Carriers in the United Kingdom, Germany, Canada and Japan said many shops ran out of the iPhone 3G, which works with speedier third-generation wireless networks, on the first day. AT&T, Apple's exclusive US partner, said most of its 2,000 stores were out of supplies, and it expected new inventory within days. Half of Apple's 187 US retail outlets were sold out as of last night.
Painful process
Piper Jaffray's estimate assumes that AT&T, the largest phone company in the US, sold 50 iPhones at each of its stores, he said. A breakdown with Apple's iTunes service had some customers leaving stores without a working phone.
"It was a lot more painful process than anyone anticipated," said Munster. "People don't seem that discouraged by the process because there were lines everywhere even after the first day."
At Apple's New York store on Fifth Avenue, the only one of its outlets that is open 24 hours a day, seven days a week, there were at least 400 people in line on Sunday waiting to buy the handset, Munster said.
Apple ran out of iPhones in 95 stores, the company's Website showed on Sunday night. All of the company's shops in Alabama, Connecticut, Indiana, Iowa, Kentucky, Louisiana, Nebraska, New Mexico, Ohio, Rhode Island and Wisconsin had no supplies left.
Apple and AT&T said last week they expected the activation process would take 15 minutes or less. Both companies demanded customers pick a two-year service plan at the time of purchase, a move designed to prevent buyers from reselling the phone or unlocking it to work on unauthorized wireless networks.
Widen business
Apple is seeking to widen its business beyond iPod media players and Macintosh computers, which accounted last year for 78 percent of sales. Chief Executive Officer Steve Jobs said he wants to sell 10 million iPhones this year to capture a 1-percent share of the worldwide phone market.
The phone was the second-biggest-selling smart phone in the US in the first quarter, behind Research In Motion Ltd's BlackBerry, according to researcher IDC in Massachusetts. Smart phones combine Internet and computer functions in a device that allow users to access e-mail and surf the Web.
Apple fell US$4.05 to US$172.58 Friday in Nasdaq Stock Market trading. The stock rose the equivalent of US$3.42 in Frankfurt trading to US$176 as of 12:57pm yesterday. Dallas-based AT&T dropped 19 cents to US$32.58 on Friday.
The new 3G model, available in black and white, sells for as little as US$199 in the US. Shoppers seem to prefer the black, 16-gigabyte model, which sells for US$299, based on the inventory tally at each of Apple's stores in 38 states.
After the original iPhone was released in June 2007 in the US, Apple sold 270,000 in the first two days.