Bloomberg News

Verizon Wireless May Report Drop-Off in Apple IPhone Sales

June 30, 2011

(Updates share prices in final paragraph.)

June 30 (Bloomberg) -- Verizon Wireless, the largest U.S. wireless provider, will probably say sales of Apple Inc.’s iPhone dropped when it reports second-quarter results, a Goldman Sachs Group Inc. analyst said.

“IPhone sales will likely be a touch below the 2.2 million” Verizon sold in the first quarter, said Jason Armstrong in a research note. Verizon began sales of the smartphone Feb. 3, more than a month into the first quarter.

Armstrong said he met yesterday with investor relations executives from Verizon Communications Inc., which co-owns Verizon Wireless with Vodafone Group Plc. Brenda Raney, a spokeswoman for Basking Ridge, New-Jersey based Verizon Wireless, declined to comment.

AT&T Inc., based in Dallas, had held an almost four-year exclusivity on the Apple handset in the U.S. The iPhone is Apple’s best-selling device, accounting for half of revenue in the Cupertino, California-based company’s fiscal second quarter.

Sales of Verizon’s other smartphones, which include the HTC Corp. ThunderBolt that works on Verizon’s faster fourth- generation network, were above the carrier’s expectations, Armstrong said.

Verizon, like AT&T, sells the iPhone 4 for $199.99 or $299.99 with a two-year contract. AT&T also offers an older variety, the 3GS, for $49 with a contract.

Verizon Communications, based in New York, rose 51 cents to $37.23 at 4 p.m. in New York Stock Exchange composite trading and has gained 4.1 percent this year. Apple rose $1.63 to $335.67 on the Nasdaq Stock Market and is up 4.1 percent this year.

--Editors: Romaine Bostick, Cecile Daurat

To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net


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