Analyst: Apple Lost $400M From Unlocked iPhones

• Posted: Thursday, February 07, 2008
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• Author: pradhana
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• Filed under: Apple, iPhone, Market Survey

According to Berstein Research analyst Toni Sacconaghi, Apple lost up to $400 million in future revenue and profit from the 300,000 to 400,000 unlocked iPhones.

The questions stem from the companies' earnings reports last week. Apple claimed it had sold 3.7 million by the end of 2007, while AT&T said it had signed up nearly 2 million iPhone subscribers by year-end.

Those numbers leave approximately 1.7 million devices missing in action. Some of these were sold in Europe, though analysts believe that number falls somewhere between 300,000 and 400,000. And some of the devices may have been sold but not yet activated for telecommunications.

But analysts believe more than 1 million devices may have been sold and unlocked, accounting for as much as one-quarter of the company's total iPhone sales to date -- a number one analyst called "astounding."

Mike Abramsky of RBC Capital Markets, estimated that 25 percent to 30 percent of iPhones are now unlocked but noted that the handsets may be "a headache for carriers, [they] are financially positive for Apple, and in our view bode well for global iPhone demand, and for Apple exceeding its 10 million, 18-month target."

Of course, last March, Harvard Business School professor David Yoffie estimated that Apple generated $400 million in free publicity for its iPhone prior to its launch. Yoffie explained that "no other company has ever received that kind of attention for a product launch...it's unprecedented." So, let's call it even.

With only an estimated 80% of iPhone sales generating that future revenue from customers, Bachman lowered his 2008 estimates for Apple to $4.90 a share on $31.54 billion in sales from a previous forecast of $4.97 a share on revenue of $31.7 billion. Bachman also cut his fiscal 2009 estimates to earnings of $6.28 a share on $37.47 billion in sales from $6.34 a share on revenue of $37.8 billion. [FierceWireless/CellularNews]

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