Photo: REUTERS/Robert Galbraith
Apple has cut its estimate for iPad and iPad Mini shipments by millions of units, Rebecca Kuo, and Alex Wolfgram of DigiTimes report, citing industry sources.DigiTimes is the Taiwan-based publication with sources in the electronics manufacturing supply chain.
They say Apple is planning on shipments of 33 million big iPads, down from 60 million units originally. The iPad Mini is expected to ship 55 million units, up from an estimate of 40 million originally.
That means overall Apple is anticipating 88 million iPads in 2013, as opposed to 100 million it originally anticipated, if the report is accurate.
Also important for investors is to note the big shift in iPad mix. Apple initially believed the big iPad was going to outsell the iPad Mini. Now, the iPad Mini is expected to be the big seller.
At entry prices, the iPad Mini sells for ~$170 less than a big iPad. Apple’s executives say the margin on an iPad Mini is below the company’s average.
Therefore, the more iPad Minis it sells, the lower its overall margin. It will also impact Apple’s sales growth.
As bad as it sounds, it’s much better than the alternative. No iPad Mini and people buy small tablets from Amazon, Google, or Samsung. In that case Apple gets zero dollars and forfeits the tablet market it created.
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