Apple Could Sell as Many iPhone 12s as There Are People in the US

Consumer Electronics

Published: September 25, 2020 6:36 am

The new Apple Inc. (NASDAQ: AAPL) iPhone 12 could sell 350 million units in the next 18 months. That is more than the 328 million people who live in the United States. The success would be due to what analysts call a “supercycle,” driven by an iPhone with so many new features that many more people than usual drop their current models for the new one. This would be a spectacular success for the huge U.S. tech company.

Several analysts have forecast iPhone 12 sales in the hundreds of millions. The 350 million unit sales prediction comes from Wedbush Securities analyst Dan Ives. Over 40 Wall Street analysts cover Apple, and most have very high estimates.

Experts expect a supercycle for at least two reasons. Most often mentioned is that the iPhone 12 will work on the world’s new ultrafast 5G networks. They move data at about 25 times the speed that the current 4G network standard does. 5G will allow people to download two-hour movies in seconds instead of minutes. The ability to play games on the internet will be enhanced. So will the quality of video calls and video chat.

5G also will make smartphone connections to many devices more useful. According to Qualcomm, which makes smartphone chips and parts of smartphone networks: “In addition to making our smartphones better, 5G mobile technology can usher in new immersive experiences such as VR and AR with faster, more uniform data rates, lower latency, and lower cost-per-bit.” Connections to cars and home devices will work more efficiently. So will such business applications as file downloads and video communication.

In terms of distribution, 5G remains in its infancy. In America, only a few large cities have complete coverage. Carriers are rushing to expand 5G networks, spending tens of billions of dollars to capture customers from one another. This is not only the case in the United States. The build-out of massive 5G networks has started in China, Japan and most other parts of Asia, as well as much of Europe. Over 3 billion people will have access to 5G within two years.

The other reason a supercycle may start soon is that Apple will launch at least four versions of the iPhone 12, which will range in price from less than $400 to over $1,200. The most expensive one will have a larger screen than any iPhone in the past. The lowest cost version will be part of Apple’s recent effort to expand iPhone sales to cost-conscious consumers. Though stripped down, it still will have a high-quality chip and camera. Most carriers make these phones seem less expensive by adding them to 24-month service contracts. That means people pay off their iPhones at a rate of less than $200 a month in some cases.

The sales of over 300 million iPhones are the cornerstone of whether Apple can keep its $1.85 trillion market valuation, the highest of any U.S. company. While Mac, iPad, Apple Watch and services contribute to Apple’s revenue, the iPhone remains the flagship and primary sales driver for the company.

Can Apple sell 350 million iPhone 12s in the next 36 months? The teetering economy may play a negative role. Beyond that, as 5G proliferates and Apple releases multiple models, the wind is at its back.