Wednesday, January 4, 2012

Apple Believed to Have Lost 1 to 2 Million Holiday iPad Sales to Kindle Fire

It's a reality - not a mere rumor - that Amazon's Kindle Fire tablet is taking a sizable chunk out of Apple's still-gargantuan share of the tablet market. And according to the latest insight from Wall Street watchers and industry analysts, Amazon's hot new device may have cost Apple a pretty penny over the holidays.

Notwithstanding the foregone conclusion that Apple will all but certainly report record sales for the fourth quarter of 2011, investment research firm Morgan Keenan speculated Tuesday that the Kindle Fire's popularity may have resulted in between 1 and 2 million fewer iPad sales for Apple over the 2011 holiday shopping season.

"Based on data from Amazon, we believe the Amazon Fire likely sold 4-5 million units this holiday season," Morgan Keenan analyst Travis McCourt said in a note to investors Tuesday, "which probably means maybe 1-2 million cannibalized iPad sales at most."

McCourt still believes that the iPad will account for 21.3% of all Apple revenue in the December quarter. If so, that's a substantial improvement over the iPad's generation of 17.2 percent of Apple's revenue during the same quarter of 2010. But before the Amazon Kindle Fire came along, the iPad was on pace to score a bigger piece of the overall tablet pie for Apple. And the Kindle Fire is being blamed for the major reason iPad sales didn't wholly dominate the holiday shopping tablet frenzy.

Source: Morgan Keenan