Apple Holiday Sales Projection Tops Estimates on iPhone X Demand

Apple forecast holiday sales that exceeded most analyst estimates, a sign it expects robust demand for the new iPhone X, the company’s most important product launch in years, according to Bloomberg.

The 10-year anniversary iPhone will help push sales to a record high of $84 billion to $87 billion in the quarter ending in late December, Apple said in a statement. Analysts predicted revenue of $84 billion. The previous record was $78 billion during the holiday quarter of 2016.

Production is “going well, we’re doing more each week and I’m pleased with how things are going,“ CEO Tim Cook said in an interview. "The initial demand for iPhone X has been very, very strong." The current six-week waiting time for online iPhone X orders will be reduced in the next two days as Apple adds more production capacity, he added.

iPhones usually account for about two-thirds of Apple revenue and the devices are a hub for a growing suite of other products and services from the company. If the iPhone X is a big hit, that could fuel growth of offerings like Apple Music and iCloud storage in coming years.

Apple shares have hit records this week, with investors predicting demand for the handset will continue in future quarters. Apple shares rose 3 percent in extended trading after closing at $168.11 in New York yesterday. That left them up 45 percent this year.

Apple also forecast a gross profit margin of 38 percent to 38.5 percent for the holiday quarter. Analysts were looking for 38.5 percent. Results over this crucial period will also benefit from the HomePod, a smart speaker that will be available in December.

For the company’s fiscal fourth quarter, which ended Sept. 30, Apple reported earnings of $2.07 a share on revenue of $52.6 billion. Analysts projected $1.87 a share and sales of $50.7 billion. Sales in Greater China rose 12 percent to $9.8 billion. Apple said Mac sales jumped 25 percent in the period, iPad revenue grew 14 percent and Other Products, such as the Watch and AirPods, surged 36 percent.