Apple expected to quickly ramp up smartwatch production

Mon Apr 13, 2015 11:47am EDT
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By Tenzin Pema and Subrat Patnaik

(Reuters) - Apple Inc (AAPL.O: Quote) is likely to quickly ramp up production of the Apple Watch after strong pre-orders outstripped limited supply, analysts said on Monday.

Apple's website lists shipping times in June for some models, and four to six weeks for others, suggesting the company is straining to meet demand.

However, analysts said Apple could sell between 2.3 million and 4 million watches in the quarter ending June.Apple was widely expected to disclose pre-orders on Monday, following its usual pattern after a product launch.

But Piper Jaffray analyst Gene Munster said this may not happen this time because of the supply issue.

"Overall we view the trends over the weekend as an indication of solid demand paired with very limited supply, with supply being the most significant limiting factor," Munster said in a client note.

Munster, who thinks Apple will sell 2.3 million watches in the April-June quarter, expects the company to ramp up production between mid-May and June.

Estimates by shopping data firm Slice Intelligence and brokerage Cowen and Co pegged bookings on Friday, the first day of pre-orders, at about 1 million in the United States.

For comparison, about 720,000 Android-powered smartwatches offered by companies including Samsung Electronics Co Ltd (005930.KS: Quote) and Sony Corp (6758.T: Quote) were shipped in all of 2014, according to market research firm Canalys.   Continued...

A customer tries on an Apple Watch at an Apple Store in Paris April 10, 2015.    REUTERS/Christian Hartmann