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Apple headed for record fourth quarter thanks to iPhone 5

Updated Dec 19th, 2018 8:35PM EST
BGR

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Following Apple’s (AAPL) announcement of the iPhone 5, market research firm IHS iSuppli is predicting the company will post record fourth-quarter smartphone shipments. The iPhone 5 is expected to drive Apple’s smartphone shipments in 2012 to 149 million units, a 60% increase from 93 million in 2011. The research firm notes that users will be more inclined to upgrade because of the larger display and 4G LTE connectivity. 

“Unlike last year’s release of the iPhone 4S, this year’s iPhone 5 announcement comes as a significant departure from previous models,” said Daniel Gleeson, mobile analyst for IHS. “The addition of a new, larger screen is a fundamental change in product design. Furthermore, the iPhone 5 is the first member of Apple’s smartphone line to feature 4G long-term evolution (LTE) connectivity, accelerating data speeds dramatically compared to previous models. These major improvements will drive strong sales for the iPhone 5.”

IHS iSuppli’s press release follows below.

iPhone 5 to Spur Record Apple Smartphone Shipments in Q4

The iPhone 5 represents a strong smartphone launch by Apple. IHS forecasts the iPhone 5 will be a major success in the market, helping to drive Apple’s smartphone shipments in 2012 to 149 million units, up 60 percent from 93 million in 2011, as presented in the figure below.

Historically, the release of a new iPhone hasgenerated a large quarter-on-quarter surge in iPhone sales. Apple’s release strategy plays a major role in this upwelling, as prospective buyers hold off on purchasing during the time leading up to the rollout of the new device. This phenomenon depressed iPhone sales in the second quarter of this year.

The new phone will be released with just over a week left in the third quarter, so most of the iPhone 5 sales bump in 2012 will be seen in the final quarter of the year. When combined with normal seasonality, IHS predicts the fourth quarter this year will be Apple’s biggest quarter for iPhone sales in history.

“Unlike last year’s release of the iPhone 4S, this year’s iPhone 5 announcement comes as a significant departure from previous models,” said Daniel Gleeson, mobile analyst for IHS. “Theaddition of a new, larger screen is a fundamental change in product design. Furthermore, the iPhone 5 is the first member of Apple’s smartphone line to feature 4G long term evolution (LTE) connectivity, accelerating data speeds dramatically compared to previous models. These major improvements will drive strong sales for the iPhone 5.”

The 4.0-inch display on the iPhone 5 compares to the 3.5-inch screen on all previous Apple smartphone models. This new display is essentially an elongated-screen version of previous iPhone displays, providing additional height with no additional width. The screen also features in-cell technology that minimizes the distance between the user and the display, and also helps reduce the thickness of the smartphone.

In the Android smartphone market, the plethora of screen sizes, aspect ratios and resolutions havecreated challenges for software developers. However, IHS anticipates that the addition of a single additional aspect ratio will not hinder iPhone app development.

“The iOS ecosystem is still the most valuable mobile content marketplace, despite Android’s size advantage,” said Jack Kent, senior analyst for mobile media at IHS. “The new iPhone will support old apps via the addition of a ribbon so as to preserve the original aspect ratio. While this will maintain the experience, it does fall short of the flawless hardware-software integration that a vertically integrated model like Apple’s should provide. However, this should only be a temporary distraction for users as developers update their apps.”

The new iPhone can connect to 4G networks that operate in several bands and is compatible with many— but not all—LTE networks in the United Kingdom, Germany, Australia, Canada, Japan, South Korea and other Southeast Asian markets.

The iPhone 5’s support of global 4G LTE frequencies will help 4G get off the ground in many markets where uptake has been muted so far. In particular, all European 4G deployments to date have seen very few compatible smartphones come to market. Now even in areas with poor 4G coverage, the iPhone 5 will cause a huge spike inthe usage of compatible devices, which should also incentivize wireless operators to build their networks faster.

However, only European operators with 4G deployments in the 1,800MHz band will be able to work with the iPhone 5’s LTE capabilities. This will affect the competitive position of carriers. Those that have LTE networks compatible with the iPhone 5 will benefit at the expense of those that either have not launched LTE or have LTE networks that operate on incompatible frequencies. An example of this is the U.K., where operator EE will hold a considerable advantage over its main competitors because it will be the only operator able to offer a 4G iPhone for up to a year.

Dan joins the BGR team as the Android Editor, covering all things relating to Google’s premiere operating system. His work has appeared on Fox News, Fox Business and Yahoo News, among other publications. When he isn’t testing the latest devices or apps, he can be found enjoying the sights and sounds of New York City.