Thursday, October 18, 2012

Apple Inc. (NASDAQ:AAPL): iPad Mini will eat into the sales of the normal iPad

This one was a no-brainer and is something that the company would have factored into its calculations.

The new iPad Mini - which the entire world is expecting Apple Inc.(NASDAQ:AAPL) to unveil on October 23 at an event in Sans Jose - will eat into the sales of the regular-sized iPads, analysts said, who expect the more women and children to be attracted to the device.

The smaller and cheaper iPad, dubbed iPad Mini by the media and the tech community, is expected to raise the overall sales of tablets by the company, but may hit the sales of its larger iPads.

Janney Capital Markets' analyst Bill Choi said that he expected cannibalisation to the extent of 15 percent by the iPad Mini on the sales of the iPad.

Gene Munster of Piper Jaffray put the cannibalisation rate at 20 percent.

"We view the smaller iPad as mostly an incremental opportunity" for Apple, Choi said. "But (we) see some modest cannibalization risk to the iPad and iPod Touch."

Choi has estimated the Apple will be able to sell about 2.5 million iPads in the December quarter, while it will be able to sell about 6 million iPad Minis and cannibalising about 1 million units from its bigger cousin.

For fiscal 2013, which began Sept. 30, Choi raised his forecast for Apple tablet sales by 19.8 million units to 102 million.

He predicted Apple will sell 32 million iPad Minis and 70 million iPads. He sees the average selling price for Apple's tablets declining to $480, from his prior estimate of $521.

The iPad Mini is expected to have a 7.85 inch display compared to the current iPad which has a display of 9.7 inches.


  1. It's OK as long as it's AAPL eating AAPL and not some other company eating AAPL.

    1. Sure, the mini will eat some AAPL but it will probably eat a whole lot more Android, Kindle and Nook.


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