Why Apple’s ‘iWatch’ Could Be A Really Big Deal
February 4, 2014
Apple's long-rumored "iWatch" could account for more revenue in its first 12 months than the iPhone and iPad did in their early years, according to Morgan Stanley analyst Katy Huberty. As first noted by CNET, the analyst says Apple’s wearable device could account for $17.5 billion in revenue. During their initial years, the iPhone triggered sales of $2.5 billion, while the iPad accounted for sales of $12.5 billion.
Early supply constraints could limit first-year iWatch revenue to anywhere from $12 billion to $14 billion. Nonetheless, this would still mean a 6 to 10 percent point bump in Apple’s 2015 revenues.
Huberty’s analysis assumes Apple will price the iWatch at around $299, and have a customer base similar to that for the iPad. She notes “Our working assumption is that iWatch largely will be adopted as an accessory device and, therefore, sold into the existing customer base, like the iPad, rather than to new customers, like the iPod or iPhone.”
Apple is likely to launch the first-generation iWatch later this year. When they do, it would be Apple’s first new product category of the Tim Cook era.
Last month, Apple posted record quarterly revenue of $57.6 billion and quarterly net profit of $13.1 billion, or $14.50 per diluted share. These results compare to revenue of $54.5 billion and net profit of $13.1 billion, or $13.81 per diluted share, in the year-ago quarter.
For more on Apple's iWatch, see: Apple Is Currently Testing Innovative Ways To Charge iWatch, Report: Apple And LG Sign 'iWatch' Exclusivity Deal, and The Best Apple 'iWatch' Concept Released To Date?
Via: CNET
Photo: iWatch mockup by Todd Hamilton