September: iPhone Vs. the Rest of the Competition
Apple, Nokia, and other companies will all launch new products this month in hopes of capturing the holiday market.
Of course, all eyes are on king of the hill, Apple (AAPL), which has sent out invites for a September 12 event in San Francisco with the words, "It's almost here" – "It" being the much-anticipated iPhone 5. There is also talk that Apple will also debut an iPad mini at the event.
Beating Apple to the punch are Motorola and Nokia (NOK). On Wednesday, Motorola, which is now owned by Google (GOOG), will drop its new high-end Droid Razr phone while Nokia will introduce its new slate of Windows (MSFT) Phone 8-backed Lumia mobile devices.
Amazon (AMZN), not to be outdone, will likely debut a new Kindle Fire one day later.
It appears that the strategy of Nokia, Motorola, and Amazon is to get their products onto the news cycle before the iPhone 5 completely swallows all media space. These companies have to "create some excitement before the iPhone 5 comes around," Michael Walkley, an analyst at Canaccord Genuity, tells the Wall Street Journal. Nokia, for example, may not even ship its new devices until next month, whereas the iPhone 5 will likely hit stores by September 21.
Nokia is hoping that the well-reviewed Microsoft mobile operating system will breathe new life into the Finnish giant, but the success of Window Phone 8 doesn't necessarily guarantee the success of its Lumia phones. Here's how Motley Fool explains the situation:
Meanwhile, sales expectations for the iPhone 5 are high, but they may not be as high as they should be, says Piper Jaffray's Gene Munster. Currently, analysts predict that Apple will see sales of around 22 million to 23 million iPhones in the fiscal fourth quarter ending September 30. Munster, however, asserts that the figure could go up to 28 million, as Apple is likely to sell between 6 million and 10 million iPhone 5s in September, as long as supply can meet demand.
The key point here: Many have labeled Microsoft the winner of the Samsung-vs.-Apple patent trial. With Android facing stiff litigation from Apple, more OEMs, including Samsung (SSNLF), ZTE, and Acer, could look to Windows Phone. If that prediction proves true, Nokia loses the differentiation it had hoped for adopting Windows Phone. Yet if Windows Phone doesn't take off, that means Nokia is strapped to a platform that continues to fall behind. Either way you look at it, the road ahead for the Finnish giant is challenging.
That would mean an 8% upside to the Street's consensus estimate of $35 billion in revenue and 12% upside to the earnings per share consensus of $8.46.
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