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Apple to Ship 39M iPhones Ahead of iPhone 6 Confirmed Release Leaving Samsung Slumping.

Apple's iPhone 6 will outperform competitors in the third quarter according to predictions. The large screen iPhone 6 variant continues to draw out favors from analysts earning forecasts as the tech giant's biggest possible release yet. More importantly, demands for the iPhone product line surges to 39 million units this June quarter leaving competitors like Samsung slumping. Despite the expected additional $100 on the iPhone 6's price, survey results suggest people are willing to pay more than higher priced Android rivals.

Apple has maintained its position about its products, their pricing and features throughout the years. The company refused to lower down prices as much as Android competitors just to secure market share. More importantly, the company has not released lower end devices to tap market sectors competitors like Android took advantage of.

According to Morgan Stanley analyst Katy Huberty, AlphaWise Smartphone Tracker results showed that iPhone remains a hot selling item. Huberty said in her research note that May data suggested that consumers demand for iPhone went up to 39 million units for June quarter. The previous year was only at 31.2 million units within three months. June 2012 quarter demand only amounted to 26 million units indicating growing patronage of the iPhone.

AlphaWise surveys from Morgan Stanley have been reliable references for Apple market demands throughout. The strong demand may be due to carrier promotions and global market expansion. For instance, AlphaWise expected Apple to ship 40.6 million units compared to 38 millions predicted by market watches. Apple shipped around 43.7 million units. Wall Street consensus set the expected unit to be around 35 million but Morgan Stanley forecast countered that.

"Similar to the March quarter, we believe promotions from Apple, retailers and carriers are driving strong demand," Huberty indicatedin her research note. The surge in demand may also be encouraged through the introduction of the 8GB iPhone 5c last March.

Apple's soaring performance and predictions goes against Samsung's posted results. According to AlphaWise, Samsung's performance has been in a slump. Figures indicated that demand for Samsung Galaxy handsets went down to 1 percent in regarding its year over year performance. The results also suggested that Samsung's demand is lower because of more affordable Android competitors.

The threat of more affordable handsets does not seem to affect the release of iPhone 6 as ( Raymond James research note revealed that there is a growing number of iPhone owners keen on spending more for a bigger screen iPhone. According to Raymond James analyst Tavis McCourt: "Apple will likely charge a $100 premium for the 5.5 inch version that media reports have suggested will be available a few months after the 4.7 inch version."

"Our June consumer survey points to continued growth in the willingness of iPhone users to pay $100 more for a bigger screened iPhone, with now a full one-third of survey respondents willing to pay a $100 premium," the analyst added.

"Data seems to suggest meaningful demand for a larger screen, which should logically mean the iPhone 6-cycle will be strong for upgrade sales, which combined with modest contribution from wearables should cause a modest acceleration in revenue growth in fiscal 2015." The company has also given Apple an outperform rating raising price target from $86 to $102.
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Publication:International Business Times - US ed.
Date:Jun 19, 2014
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