Apple sells more than 300,000 iPads on first day
SEATTLE—Apple Inc. said Monday that it delivered more than 300,000 iPads on its opening day, meeting expectations of some analysts while underscoring the challenges the company still faces marketing the device beyond early adopters.
The total seemed modest given the weeks of hype about the revolutionary nature of Apple's new touch-screen tablet device. Furthermore, the figures included pre-orders that were picked up or delivered Saturday and iPads sent to retail stores such as Best Buy but not necessarily purchased. Apple did not say how many went to such stores.
Assuming most of the 300,000 iPads ended up in the hands of consumers Saturday, though, the figure is in line with the number of iPhones that Apple sold when the smart phone made its debut in June 2007. Apple didn't publicize first-day sales at the time, but later earnings reports indicated the company sold about 270,000 iPhones during the first two days the gadget was available.
Apple sold 1.1 million more iPhones over the next three months. The volume has only increased as Apple has released new versions of the phone in a growing number of countries and software developers have created add-on programs, or "apps," that do everything from online banking to mapping bike rides using GPS. In the most recent quarter, Apple sold 8.7 million iPhones.
Kaufman Bros. analyst Shaw Wu wrote in a note to investors Monday that he believes a similar pattern will unfold for the iPad.
"When the iPhone was first launched, it was also somewhat of a disappointment," Wu wrote. "But as the iPhone got more refined, with more apps, better software, not to mention better prices," then sales picked up.
Wu had estimated the iPad's sales at 250,000 to 300,000 for the weekend. In the research note, the analyst wrote that manufacturers said Apple was telling them to get ready to ship 10 million iPads in the first 12 months, twice as many as previously expected.
With the iPad in its early days, the iPhone will continue as Apple's star product this year, Broadpoint Amtech analyst Brian Marshall said in a note to investors Monday. Marshall had predicted Apple would sell 525,000 iPads over the Easter weekend, despite some stores being closed for the holiday.
The iPad is "off to a fantastic start," he wrote, but he still expects iPhone sales to top $20 billion this year, eight times his forecast of $2.5 billion for the iPad.
The same hoopla that drew eager shoppers to long lines outside of Apple stores swept away a few analysts, too. Piper Jaffray analyst Gene Munster published a research note early Monday boosting his initial forecast for first-day sales to 600,000 to 700,000 -- only to quickly follow with a second note admitting he'd jumped the gun.
"We were overly optimistic," he wrote. Munster's original forecast was for 200,000 to 300,000 iPads to be sold on Saturday.
However, Munster wrote that he still expects Apple to sell 1.3 million iPads in the current quarter.
Apple devotees were willing to queue up across the country to be among the first to own an iPad, even if they weren't exactly sure what they'd end up using it for. The models currently on sale connect to the Internet using Wi-Fi; prices start at $499. A second wave of buyers may emerge when Apple starts selling versions that can also get online using cellular networks; those models start at $629.
Once the early excitement settles, Apple needs to convince a broader swath of people to buy if it wants the iPad to follow the iPhone's successful trajectory.
Many companies have tried to sell tablet computers before, but none has caught on with mainstream consumers. Apple's iPad comes at a time when people have even more Internet-connected gadgets -- smart phones, laptops, e-book readers, set-top boxes and home broadband connections -- and it may need to work harder to persuade people to buy yet another device that serves many of the same purposes.
Apple also said Monday that new iPad owners downloaded more than a million applications and more than 250,000 electronic books from its iTunes store on Saturday.
Shares of Apple, which is based in Cupertino, Calif., rose $2.52 to close at $238.49 Monday.
AP Business Writer Deborah Yao in Philadelphia contributed to this report.