Apple may have sold 700,000 iPhones, beating estimate

Apple Inc.'s initial iPhone sales may have beat analysts' top projections, suggesting Chief Executive Officer Steve Jobs will reach his goal of making mobile phones as profitable to the company as computers and the iPod.

Shoppers may have bought as many as 700,000 units over the weekend, Goldman Sachs Inc. analyst David Bailey said, twice his projection of 350,000. Piper Jaffray's Gene Munster pegged sales at about 500,000, more than twice his original 200,000 estimate.

More than a third of Apple's 164 stores were out of stock by last night, according to the company's Web site, leaving shoppers in states such as Hawaii, Nevada and Utah to try AT&T Inc. stores. AT&T, the exclusive provider of wireless service for the iPhone, said most of its 1,800 stores sold out within 24 hours.

"This is a very successfully handled launch," Munster, based in East Palo Alto, California, said in an interview today. He's rated Apple's shares "outperform" since June 2004. "The real sign of success would be what kind of legs this product has in 2008 and 2009. In 2009, we estimate a third of Apple's sales will be from iPhone. This is a huge product."

J.P. Morgan Securities Inc.'s Bill Shope said sales may have reached 312,000 in the days following the device's June 29 debut. American Technology Research analyst Shaw Wu, who called his initial 50,000 estimate conservative, said in a note today that Apple may have sold five times as much.

Shares of Cupertino, California-based Apple fell 53 cents to $121.51 at 12:29 p.m. New York time in Nasdaq Stock Market trading. Before today, they had gained 43 percent since Jobs unveiled the combination iPod media player and phone on Jan. 9.

AT&T Fixes

Mark Siegel, a spokesman for San Antonio-based AT&T, declined to confirm whether stores had completely sold out of the device, saying only that "things have just gone extraordinarily well." Apple spokesman Steve Dowling didn't return a call seeking comment before regular business hours.

AT&T is still fixing problems for some customers who can't activate their new phones, Siegel said today in an interview. Some business customers need approval from their companies' communications departments to switch to personal subscriptions, he said. The "overwhelming majority" have activated the phone.

Siegel declined to say how many iPhones the company has sold or how many users switched to AT&T, the largest wireless service provider in the U.S., from other providers. AT&T's calling plans for the phone cost $60 to $220 a month.