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Analysts are worried consumers waiting for the next iPhone may cause Apple (NASDAQ:AAPL) to announce its slowest sales and profit growth in more than two years on Tuesday. Analysts estimate that sales of the iPhone, which has been Apple’s biggest source of revenue, fell in the fiscal third quarter. Even though Apple has not formally announced when it will unveil a new iPhone, speculation has grown that the launch will take place in fall, in line with the company’s final release of the new version of its iOS operating system.
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“People are waiting,” Pacific Crest Securities analyst Andy Hargreaves told Bloomberg. Hargreaves estimates Apple to have sold 25.4 million iPhones, compared with 35.1 million in the previous quarter. The average of estimates says Apple will report a profit growth of 35 percent to $9.86 billion, while sales are expected to grow 31 percent to $37.3 billion.
A similar slowdown had occurred ahead of last year’s iPhone 4S release in October, with the company reporting profit that stayed short of analysts’ estimates for the first time since 2003.
Apple is rumored to be overhauling the look of the iPhone, with a larger screen, a thinner body, a more powerful processor, and a new dock connector. The device is also expected to start working with the faster 4G LTE network of carriers like Verizon (NYSE:VZ) and AT&T (NYSE:T).
The weak global economy, subsidy changes by wireless carriers, as well as competition from newer devices of Google (NASDAQ:GOOG) Android rivals like Samsung may have also hurt Apple. However, some of the drop in iPhone sales may partially be balanced out by iPad purchases, with both education and enterprise users contributing to an expected growth in sales of the tablet.
Delayed iPhone purchases could have their biggest effect on Apple’s financial results during the current quarter, which ends in September. Sanford C. Bernstein analyst Toni Sacconaghi wrote last week that Apple was likely to provide an “unusually conservative” outlook for that period.
While concerns about the third and fourth quarters grow, some are already looking ahead to the period of the launch of the new iPhone. A customer survey by Piper Jaffray Gene Munster found that more than 80 million iPhones will be sold when the new model is released.
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