One year ago, less than 40% of mobile subscribers in the United States had a smartphone. That number has increased dramatically, however; according to Nielsen, one in two mobile subscribers now owns a smartphone. Driven mostly by the rise of Android and iOS, which account for more than 80% of the U.S. smartphone market, 2012 has turned into the year of the app. The average number of apps installed on each smartphone has jumped 28% in 2012, an increase from 32 apps to 41. Smartphone owners are also spending increasingly more time using apps than using the mobile web, roughly 10% more than last year. Nielsen notes that the top five most active apps continue to be Facebook, YouTube, Android Market (now Google Play Store), Google Search and Gmail. Despite the increase of apps, smartphone owners spend roughly the same amount of time using them each day — 37 minutes in 2011, compared to 39 minute in 2012.

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Sprint’s costly $15.5 billion gamble on Apple’s iPhone won’t pay off until 2015, according to CEO Dan Hesse. At that time, however, the iPhone will be “quite profitable,” and the company is “very happy” with the deal despite conflicting reports, AllThingsD said. Hesse sees the iPhone as a long-term investment that will slow subscriber defections and attract new customers. “We believe in the long term,” the CEO said. “And over time we will make more money on iPhone customers than we will on other customers.” Sprint sold 1.5 million iPhones in the first quarter of 2012, and while the number doesn’t approach AT&T or Verizon’s sales, 44% of Sprint’s iPhone sales were made to new customers.

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Analysts for Barclays said in a note to investors that a new 7-inch iPad will be released this fall, Business Insider reported on Wednesday. “Following up on comments made last week, recent research still leads us to believe that Apple may be planning to add another form factor to its iPad line in the 7″ range for the fall,” the note read. The banking firm states that a smaller iPad would be useful in promoting Apple’s education agenda and could also help the company’s gaming efforts. Rather than sullying the iPad brand and iOS ecosystem, Barclays states that a “lower priced iPad [is] a necessary entry point to make the tablet market the size of the PC market by 2015 in terms of units (over 350 million units) – a figure CEO Tim Cook repeatedly mentions.” Apple has long been rumored to be readying a 7.85-inch iPad mini to compete with Amazon’s Kindle Fire and Barnes & Noble’s Nook Tablet. The slate is expected to be priced between $249 and $299, and could launch as soon as the third quarter of 2012.

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Facebook is just days away from one of the largest initial public offerings of all time. The social networking site is looking to raise more than $16 billion dollars at a valuation in the $100 billion price range. Facebook is worth a lot of money, and a company called Abine has created a program to determine just how much individuals are worth to Facebook. The program, called Facebook Val-You Calculator, determines a user’s worth with the help of seven questions regarding the number of friends they have, how often they “like” things, and even their salary range. Individuals are priced anywhere from $1 to more than $100, however according to research firm Forrester, Facebook made less than $4 per active user in 2011.

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Verizon Wireless plans to eliminate its $30 per month unlimited data plan that it provides to customers who subscribed to the plan prior to the company’s transition to tiered data plans last July, Fierce Wireless reported on Wednesday. Verizon CFO Fran Shammo said at the 40th J.P. Morgan Technology, Media and Telecom conference that once unlimited 3G data plan customers upgrade to 4G LTE, they will have to purchase the company’s shared data plan. “Everyone will be on data share,” Shammo said. The carrier’s shared data plans are scheduled to launch in the coming months, and will allow users to share a single pool of data between multiple devices. “If I can add as many devices as I want, that is more efficient from a family perspective and a small business perspective,” the CFO said. When asked how Verizon will migrate customers off their unlimited data plans, Shammo said that LTE will draw customers away from it. “A lot of our 3G base is on unlimited,” he said. “When they migrate off 3G they will have to go to data share. That is beneficial to us.”

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Successfully launching an iconic smartphone is a daunting task, and following up a blockbuster flagship phone launch is even more difficult. Apple and Samsung might make it look easy, but companies like Motorola, Nokia and RIM have shown us that the success of one phone is anything but a guarantee that sequels will be met with the same fanfare. Perhaps no recent smartphone launch better embodies that notion than the HTC EVO 4G, a smartphone that gave Sprint a much-needed smash hit when it launched in 2010, and its successor the EVO 3D, which is now all but forgotten less than a year after its debut. Now, Sprint and HTC are back again with the HTC EVO 4G LTE, a smartphone that is more than worthy of its “flagship” designation. Impressive though it may be on paper, can Sprint score an EVO 4G-sized hit with this upcoming superphone or is it destined to meet the same fate as the EVO 3D? My full review follows below.

The Inside

HTC’s business exploded beginning in early 2011, and the company went on a run that saw it post record revenue for six consecutive months. The vendor’s growth came to a screeching halt in the fourth quarter, however, thanks to the launch of Apple’s iPhone 4S and increased competition from Samsung. HTC is well aware that it fell behind, and it is also well aware that a window may have opened; the company’s direct response to a BGR article on the matter suggests HTC is ready for battle, and on paper, the HTC EVO 4G LTE — Sprint’s branded and redesigned version of the HTC One X — is a very powerful weapon.

As is the case with AT&T’s One X, the HTC EVO 4G LTE loses NVIDIA’s quad-core Tegra 3 chipset in favor of the LTE-compatible Qualcomm Snapdragon S4, which includes a 1.5GHz dual-core Krait CPU and an Adreno225 GPU. Performance and responsiveness may or may not take a hit as a result of the change, but I did experience the same performance hiccups covered in my review of the HTC One S.

HTC’s Sense 4 UI and service layer sits atop Android 4.0.3 Ice Cream Sandwich, and it is most definitely a step in the right direction compared to previous versions of Sense. As discussed in BGR’s review of HTC’s One S for T-Mobile, Sense 4 goes back to the basics for HTC. It focuses more on adding value for the end user and less on differentiation for the sake of differentiation.

Beyond the processor and operating system, this smartphone is packed to the brim with cutting-edge technology. In terms of connectivity it includes CDMA, EV-DO, LTE, Wi-Fi 802.11a/b/g/n with DLNA and mobile hotspot support, Bluetooth 3.0, USB 2.0 and near-field communication (NFC) support. It also features 16GB of internal storage, a microSD slot for up to 32GB of additional memory, 1GB of RAM, an accelerometer, a gyroscope, a proximity sensor, a compass and plenty more.

Though the EVO 4G LTE is only 8.9 millimeters thick, HTC managed to squeeze in a 2,000 mAh battery. While I couldn’t test the device’s battery performance on Sprint’s 4G LTE network since such a thing does not exist, battery life on Wi-Fi and 2G/3G was more than ample. I was able to easily make it through a full day of moderate usage on a single charge, and after charging the phone early in the morning, I often didn’t have to plug the EVO back in until mid-way through the following day.

Typical usage during my testing included streaming music via Pandora, regularly interacting with Twitter, monitoring Reddit with Baconreader, staying on top of the news with gReader and News360, capturing a bunch of photos and some video, browsing the Web in Chrome and sending and receiving more email than any man should ever have to deal with.

The Outside

As is the case with most modern flagship phones from HTC, the EVO 4G LTE’s build is second to none. Barring one area that I will soon cover at length, HTC used top-notch materials on the EVO and the result is a solid smartphone that feels like a premium product should.

The display and capacitive navigation buttons on the HTC EVO 4G LTE are covered with Gorilla Glass by Corning, and a front-facing 1.3-megapixel camera sits above the top of the screen alongside the ear speaker. Calls on the EVO were loud and clear, and people I spoke to during my tests had no complaints whatsoever regarding call quality.

The display on this smartphone is very impressive. HTC opted for a Super LCD2 panel that squeezes high-definition 720 x 1,280-pixel resolution into display that measures 4.7-inches diagonally, and the result is a pixel density of 312 ppi. It’s a beautiful display.

While the clarity isn’t on par with the likes of Apple’s Retina display on the iPhone, it is certainly among the most impressive I’ve seen on a smartphone. Images and high-definition video look fantastic on the EVO 4G LTE’s screen, and UI elements are impressive as well. Colors aren’t quite as deep as they are on the Super AMOLED panel HTC used in the One S, but the higher resolution is well worth the trade off.

The right side of the phone contains a volume rocker and a dedicated two-stage camera shutter button — something that is noticeably absent from AT&T’s version of the One X — and the left edge of the phone is home only to a microUSB port. The top of the new EVO includes a power button, a secondary microphone for noise cancellation and a standard audio jack, while the bottom contains the primary mic. On the back of the smartphone sits a loudspeaker, a camera, a single LED flash and a red aluminum kickstand.

The bulk of the case is made of anodized aluminum, but HTC added a twist to its design that we have not seen before on any smartphone. The unibody aluminum part of the case is anodized in black across the entirety of its exterior surface, but then the anodized layer is ground away in a thin strip around the outer edge of the phone. The result is a sleek black case with red accents on the back, and then a brushed aluminum band around the outer edge of the phone.

It’s an interesting idea that might have made for a fantastic looking smartphone had HTC not used a glossy black plastic piece to cover the top half of the back of the EVO 4G LTE.

The Upside

I had a great deal of praise for HTC’s fourth major iteration of Sense when I reviewed the One S for T-Mobile recently, and Sprint’s EVO 4G LTE keeps the experience surprisingly pure.

“Sprint Zone” is the only carrier-branded application you’ll find on this smartphone out of the box, and it can hardly be categorized as annoying, intrusive or “bloatware.” Quite to the contrary, the app offers a single hub through which users can access account management features, app recommendations, a Sprint store locator and plenty more. In theory, this is great. In practice, the first time I tried to access anything through Sprint Zone (the Manage Your Account link), the app froze, couldn’t be killed using the EVO’s built-in task manager, and remained useless until I rebooted.

Beyond Sprint Zone and a visual voicemail app, the EVO 4G LTE experience is essentially exactly as HTC intended it. HTC dialed Sense 4 back a bit after taking user feedback to heart. The result is an attractive user interface that adds unique visual elements to Google’s Android 4 Ice Cream Sandwich UI, a suite of custom apps and a series of great features that enhance Android.

Samsung will push the envelope further with the launch of the Galaxy S III this summer, but HTC’s subtle functionality automation tweaks really add to the overall user experience where daily operation is concerned. The examples I mentioned in my One S review are still among my favorite: a simple setting has Sense greet users with the weather forecast each morning on the lock screen, another setting that automatically enables speakerphone mode when the phone is placed face-down on a table during a call and disables it when the phone is picked back up, and so on.

Moving past the software, the display on the EVO 4G LTE is another bright spot for this flagship phone.

In the television industry, display quality is everything. Vendors strive to outdo each other, and later this year we will see Samsung and LG push things to the next level when they release their debut 55-inch OLED TVs. Of course display quality will never be as important to smartphones as it is to TVs, for obvious reasons, but I believe we are quickly approaching a time when picture quality will be regularly named among users’ top priorities when choosing a device.

Samsung and Apple are clear leaders in this space right now. Apple’s Retina display on the iPhone 4S offers unrivaled clarity and Samsung’s Super AMOLED panels feature vivid colors that no other screen even approaches. Competitors are regularly narrowing the gap, however, and HTC can certainly be counted among the smartphone players that have recognized the importance of display quality on phones.

HTC’s One S utilized a Super AMOLED display panel on while the color reproduction is definitely more impressive, the Super LCD2 panel on the EVO is outstanding. Colors are often a bit more faint compared to AMOLED displays, but the clarity is where this screen shines. Compared to panels on HTC’s previous-generation smartphones, the EVO 4G LTE’s 720p high-definition display is clearer and brighter, and it really does have a significant impact on the user experience.

The camera and Beats Audio are two more big check marks in the plus column for this phone. The EVO 4G LTE sports an 8-megapixel camera with an f/2.0 wide-angle lens, and it is powered by a dedicated chip. It can capture 8-megapixel still images while recording 1080p HD video at 60 frames per second, and it can also shoot multiple full-resolution images per second in burst mode.

HTC’s camera on the new EVO can capture an 8-megapixel image and then return to a ready state in less than a second. The camera app in Sense also includes a number of Instagram-like photo filters that can be previewed in real-time, and having a dedicated two-stage shutter button makes the camera experience even better than it is on AT&T’s version of the One X.

Beats Audio works across all music apps on the EVO 4G LTE, as it does on all One-series phones, and it may very well offer the most impressive listening experience among all smartphones on the market. Beats tuning enhanced sound quality across every genre I played from my own catalog during testing, and it dramatically improves the listening experience with streaming apps like Pandora and Spotify as well.

The Downside

As impressed as I have been with the overall user experience offered by the HTC EVO 4G LTE, two gigantic road blocks lie between me and any possibility of an enthusiastic recommendation to run out and buy this phone when Sprint releases it in the near future.

First things first: it’s hideous.

I’ll elaborate — from the front, the new EVO is a great looking phone. It basically looks like any other full touchscreen handset. Tilting the device to its side exposes the brushed metal detailing that surrounds the outer edge of the phone, which is a unique feature that might help separate this phone from the pack. Flip the phone over to expose its back, however, and the fun is over.

HTC uses various plastics on the exterior casing that surrounds its many phone models. AT&T’s One X utilizes a sleek polycarbonate, and a number of other devices feature a soft-touch rubbery finish that feels great in the hand. I enjoy either of those options.

The EVO 4G LTE includes two plastics on the exterior of the device. Near the bottom of the back, there is a narrow hard plastic area near the speaker that nearly matches the aluminum finish above it. It breaks up the lines a bit, but it works. Above the aluminum region that sits near the middle of the back of the phone lies a red aluminum strip that houses the device’s kickstand. It’s not my cup of tea but there are definitely people who will enjoy this design element.

Then comes the cheap, glossy, flimsy, grease magnet of a plastic cover that houses the antennas and covers the microSD card slot.

During the week I have spent with the EVO 4G LTE, I asked more than a dozen friends, family and random people of varying ages for their initial impressions of this smartphone. Without exception, a complaint about the appearance of the handset was among the first few comments made, and it was often accompanied by an expression that might involuntarily cross one’s face after taking a big swig of milk that spoiled a month earlier.

I honestly have no idea who the look of the EVO 4G LTE might appeal to.

Why HTC chose this finish is beyond me, because the soft-touch finish found on other HTC models would have looked great here. I sincerely hope Sprint enlists the help of some top-notch protective case designers and offers a wide variety of high-quality third-party cases in its stores across the country, because something needs to be done to cover the back of this phone.

My other major qualm with this smartphone involves data speeds. Painfully slow data speeds.

T-Mobile and AT&T get jabbed constantly for marketing their HSPA+ networks as “4G.” In these cases, a matter of marketing is at the root of the debate and data speeds are typically more than adequate.

In the case of the EVO 4G LTE, Sprint is actually selling a device with “4G LTE” in its name and no 4G LTE network to support it. Sprint will roll out its LTE network over the next 18 months or so, but in the meantime, I spent a week testing a “4G LTE” phone with download speeds that averaged less than 1Mbps.

And as an aside, that name — ”HTC EVO 4G LTE” — is a horrible one. Enough with “4G” and “LTE” in phone names, carriers.

The Bottom Line

When it launches in the near future — the phone was supposed to be released on May 18th but a delay caused by a patent spat between HTC and Apple has left things up in the air — the HTC EVO 4G LTE will easily be one of the most impressive flagship smartphones Sprint has ever released. And one of the ugliest. And one of the slowest.

Beauty is in the eye of the beholder, but I truly have no idea who might look at the back of the HTC EVO 4G LTE and think to him or herself, “now this is one gorgeous smartphone.” In my unscientific study, I did not find a single person who liked the look of this phone. Instead, each and every person I handed the device to said it was “ugly,” “gross,” “nasty,” or “hideous” without any provocation.

Aesthetics are open to discussion but performance is not. This smartphone, which includes the term “4G LTE” in its name, is the slowest flagship device I have tested in recent memory. Compared to Verizon Wireless and AT&T’s LTE networks or even T-Mobile and AT&T’s HSPA networks, the data speeds I experienced while testing the EVO 4G LTE were simply pathetic.

Of course this phone is slow, you might say to yourself. Sprint hasn’t yet begun to roll out its next-generation 4G LTE network!

This is indeed the case, and while Sprint is under immense pressure to catch up in terms of network technology, launching the EVO 4G LTE without any 4G LTE network to support it — and having the audacity to include “4G LTE” in the device’s name — is putting the cart before the horse at best. At worst, it’s disingenuous.

The simple truth is that most customers who consider purchasing the “EVO 4G LTE” will do so with the belief that the phone will come alongside “4G LTE” service. For early adopters, this will not be the case. In fact, even months from now as 2012 rolls into 2013, a huge chunk of Sprint’s nationwide network will still not support LTE service.

At $199.99 on contract, the EVO 4G LTE offers a user experience that is second to none… as long as you cover it with a third-party case and stay within range of a Wi-Fi network. If you would prefer to roam about freely and maintain fast data speeds, or if you shudder at the thought of ruining the handset’s 8.9-millimeter thick profile with a bulky case, looking elsewhere might be the best option.

Just two days before its initial public offering, Facebook has increased the number of shares it will offer by 25%. The social networking giant will now offer 421 million shares to investors, 83.8 million shares more than it had originally planned to make available. Facebook is looking to price its stock between $34 and $38 per share, potentially allowing the company to raise more than $16 billion, making it the largest technology IPO and third-largest of all time behind Visa and GM. Fortune notes that the share increase will not affect Facebook’s valuation, however, as the extra shares are being reallocated out of the company’s existing share count. Facebook will be listed on the NASDAQ under ticker symbol FB.

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Android’s rise to the top of the mobile operating system food chain as measured by device proliferation has been remarkably swift, but not without its drawbacks. Due to the nature of Google’s open source OS and its aggressive strategy, smartphone vendors that make use of the platform have each gone their own way with software development, hardware design and other key elements. As a result, Android fragmentation, which might be defined as the spread of diverging versions of the Android OS across devices with varying core characteristics, was born.

Whether or not fragmentation is a problem in the Android ecosystem is a topic that is intensely debated by enthusiasts. Some claim the problem will eventually lead to Android’s downfall while others deny the issue even exists. Outside of these heated debates, a number of individuals and firms have tried to analyze the matter and look at fragmentation’s potential impact on the bigger picture.

In October last year, developer Michael DeGusta created a visualization of what he called Android’s fragmented update history. “Ever since the iPhone turned every smartphone into a blank slate, the value of a phone is largely derived from the software it can run and how well the phone can run it,” DeGusta wrote. “When you’re making a 2 year commitment to a device, it’d be nice to have some way to tell if the software was going to be remotely current in a year or, heck, even a month.”

Following DeGusta’s report, graphic designer Chris Sauve took data from a number of sources earlier this year in an attempt to measure fragmentation and in doing so, he determined that despite its unveiling in 2010, 2012 will be the year of Gingerbread. So far, there is no denying that he is right — Gingerbread currently resides on more than 64% of Android devices globally according to Google’s own Android distribution data.

Now, OpenSignalMaps has thrown its hat into the ring. Using data from 681,900 devices that downloaded the firm’s software over the past six months, OpenSignalMaps found there to be 3,997 distinct Android devices running its app, though the figure counts each custom ROM found to be running on various smartphones as a separate device.

The developer found a staggering array of Android version and display resolution combinations, and said the issue is likely to get worse. “[Android version] and screen fragmentation is probably going to get worse,” the firm wrote in its report. “Android has, however, shown committment [sic] to make it easier to target multiple screen sizes – by introducing the (perhaps ironically named) fragments APIs in 2011 which makes it easier to turn view elements into modules.”

But despite the current trend, OpenSignalMaps concluded that the benefits of building apps for Android far outweigh the drawbacks. ”One of the joys of developing for Android is you have no idea who’ll end up using your app,” the firm noted. “With many devices under $100 unsubsidized, Android phones and tablets are able to reach a market that can’t afford netbooks. For the majority of the world’s population smartphones (and not computers) will be the must-have devices.”

The launch of Sprint’s flagship EVO 4G LTE has been delayed indefinitely and supply of AT&T’s flagship HTC One X will be constrained as a result of ongoing patent disputes between HTC and Apple. HTC confirmed in a statement emailed to BGR on Tuesday evening that shipments of its new EVO 4G LTE and One X smartphones have been held up by United States Customs as part of an International Trade Commission investigation. Before the phones can clear Customs, the ITC will need to determine that HTC’s new handsets are in compliance with an earlier ruling.

“The US availability of the HTC One X and HTC EVO 4G LTE has been delayed due to a standard U.S. Customs review of shipments that is required after an ITC exclusion order,” an HTC spokesperson said. “We believe we are in compliance with the ruling and HTC is working closely with Customs to secure approval. The HTC One X and HTC EVO 4G LTE have been received enthusiastically by customers and we appreciate their patience as we work to get these products into their hands as soon as possible.”

Sprint was scheduled to launch the EVO 4G LTE, a customized version of the One X, on May 18th for $199.99 on contract. AT&T made the One X available earlier this month, however the device is now listed as out of stock on AT&T’s website and supply will be constrained until shipments clear Customs. The import delays mark the first time one of Apple’s numerous patent complaints against rivals in the U.S. has paid off.

Shares of HTC stock tumbled more than 6% on news of the import delays.

Apple’s sixth-generation iPhone handset will reportedly feature a larger display that measures “at least 4 inches diagonally.” Mirroring numerous earlier reports, The Wall Street Journal on Wednesday cited multiple anonymous sources in claiming that Apple’s next iPhone will include a new larger display. The Journal adds that panel orders have been placed, however, and that Apple has tasked LG Display, Sharp and Japan Display with supplying the new screens. A recent report claimed the next-generation iPhone would utilize the same 3.5-inch screen found on Apple’s iPhone 4S and iPhone 4, however multiple earlier reports suggested that the new iPhone will finally receive a larger 4-inch Retina display and 4G LTE compatibility. BGR exclusively reported in December that Apple will launch a completely redesigned iPhone this fall that will include a redesigned antenna system, likely alongside a new aluminum case and 4-inch display.

UPDATE: Reuters independently confirmed The Journal’s claims with its own sources in a report Wednesday morning.

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Sony and Panasonic are reportedly in talks to develop the technology needed to mass produce next-generation OLED televisions, according to Reuters. The two companies would be playing catch up to their South Korean rivals, Samsung and LG, both of which plan to market 55-inch OLED TVs later this year. “Overseas competitors have gotten a head start in this area and I feel like they’re stepping into this too late,” said Masayuki Otani, chief market analyst at Securities Japan. “There’s no question OLED TVs are going to be the mainstream. The issue is price and size of the displays.” OLED panel technology, which Sony pioneered in 2007, provides users with improved picture quality, deeper color saturation with high contrast, and allows vendors to make TVs as slim as 4 millimeters that consume less power than traditional LCD sets. There is a barrier, however: current OLED TVs are very expensive — Samsung’s upcoming 55-inch OLED TV will cost $9,000 when it launches in South Korea in the coming months.

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Facebook on Tuesday raised its initial public offering price target range to between $34 and $38 per share in response to strong demand, an increase from $28 to $35, according to a new filing with the United States Securities and Exchange Commission. The new price range pushes the social networking company’s valuation to between $93 billion and $104 billion. Facebook will offer a total of 388 million shares, and is looking to raise $14.7 billion. Facebook will make its initial public offering on May 18th and its shares will be listed on the NASDAQ exchange under the “FB” ticker symbol.

[Via TechCrunch]

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Samsung recently updated its website to include a list of T-Mobile devices that will receive Android 4.0 Ice Cream Sandwich upgrades. “Samsung is in close communication with both Google and our carrier partners to upgrade devices to Android 4.0 Ice Cream Sandwich as quickly and as smoothly as possible,” the company wrote on its website. The manufacturer will be issuing over-the-air updates to the Galaxy S II, Galaxy S Blaze 4G, Galaxy Tab 7.0 Plus and Galaxy Tab 10.1. Unfortunately, neither T-Mobile nor Samsung have announced a release schedule for the upcoming updates.

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General Motors, the world’s largest automaker and third biggest advertiser in the U.S., plans to stop advertising on Facebook, The Wall Street Journal reported on Tuesday. After meeting with Facebook managers to address concerns, the company’s marketing executives were left unconvinced of the effectiveness of the site’s advertising methods, claiming its paid ads had little impact on consumers. GM will thus pull its $10 million ad spend, although the automaker will continue to use the social networking site to display free content on its own Facebook page. GM is only skeptical about Facebook, and not about digital advertising as a whole; the company spends almost $300 million each year on digital brand advertising. The news comes at a bad time for Mark Zuckerberg and company, who are on the verge of their initial public offering.

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Sterne Agee analyst Shaw Wu said in a note to investors on Tuesday that Apple has reduced iPhone orders by between 20% to 25% from the 35.1 million units the company shipped in the March quarter. Wu now expects shipments of between 26 million and 28 million iPhones, lower than the Street’s consensus of between 30 million and 31 million units. The analyst also noted that Apple has an estimated 8.6 million iPhones in channel inventory, 2.6 million of which were added in the most recent quarter, allowing the Cupertino-based company to achieve supply-demand balance of between four to six weeks.

“From our understanding, the reason for the reduction is not demand related but rather due to the upcoming 6th generation iPhone refresh likely in the September-October timeframe,” Wu explained. “It appears that AAPL is opting to be conservative with its suppliers to factor in a potential 2-quarter pause ahead of the refresh and also to manage inventory. We believe this helps explain why its June quarter guidance was somewhat more conservative.”

The analyst went on to state that the opposite is occurring with Apple’s iPad tablet, which is seeing increased build plans. Shipments of the device were previously held back due to supply constraints on its new Retina Display, although it has been “greatly improved with an additional supplier.” Wu believes that this will help Apple to better meet the strong demand for its iPad.

For the June quarter, Wu reduced his iPhone forecast from 28 million units to 27 million, and raised iPad shipment expectations from 14 million to 15 million units. Due to improved iPad profitability, the analyst is increasing his gross margin assumption from 42.5% to 43.5% and forecasting $36.1 billion in revenue and $10.16 in EPS. Wu reiterated his Buy rating on shares of Apple stock, as well as his $780 price target.