Apple sells more than 1 million iPhone 3GS

NEW YORK Mon Jun 22, 2009 7:36pm EDT

1 of 3. A customer looks over the Apple iPhone 3GS at the company's retail store in San Francisco, California June 19, 2009.

Credit: Reuters/Robert Galbraith

NEW YORK (Reuters) - Apple Inc said it had sold more than 1 million of its newest iPhone in the first three days of launch, beating analysts' expectations for the 3GS smartphone's debut.

The statement from Apple also included a quote from Chief Executive Steve Jobs, leading at least one analyst to speculate that this meant he was back from medical leave.

Jobs, a pancreatic cancer survivor, has been on leave since January for an undisclosed condition, although the company has said he remains deeply involved in decision-making. The Wall Street Journal reported on Saturday that Jobs had a liver transplant two months ago, but he was expected to be back at work before the end of June.

"This is the first time we've heard from Steve Jobs since he reported he was taking medical leave," said Oppenheimer & Co analyst Yair Reiner. "It's a sign Apple has its CEO back."

Apple representatives were not immediately available for comment.

Shares of Apple rose as much as 1.5 percent in early trading before reversing course to trade down 1.1 percent at $137.96.

Analysts said the iPhone sales figures would distract some investors from concerns about Jobs' health to a certain extent.

"I think they'll focus on the 1 million number," said Susquehanna Financial Group analyst Jeffrey Fidacaro. "Investors will realize that Apple executed well on the launch in Jobs' absence."

The 3GS debut was only in eight countries, he said, compared with 21 in last year's 3G launch.

The 1 million 3GS iPhones sold were "an impressive number compared with the 1 million they sold in the first weekend last year across 21 countries," Fidacaro said. "It shows that the iPhone momentum remains strong."

The 3GS, which offers faster speeds, longer battery life and the ability to take videos, hit stores last Friday, drawing plenty of fans but not the crowds that had swarmed previous iPhone releases, due in part to preorders.

Exclusively on AT&T Inc's network in the United States, the iPhone competes with BlackBerry phones from Research in Motion and the Pre from Palm Inc

Despite the impressive weekend sales, Fidacaro said some investors would still have concerns about Jobs' health and whether he can continue as a driving force at Apple.

"He's obviously the clear visionary of the company," Fidacaro said. "There is a concern about his health and what Apple has told us about his health and what role he'll be playing when he returns."

Analysts have said that Jobs may soon shift to a new role focusing on big-picture issues and products at Apple, leaving Chief Operating Officer Tim Cook to manage the day to day. Cook has been overseeing operations in Jobs' absence.

Shares of Apple have risen more than 60 percent this year as investors grow more comfortable with the executive bench beyond Jobs. Continued strong sales and product launches at the company have also helped.

"On the one hand, you have the Jobs news out there, which might give people some pause, but on the other hand, iPhone 3GS sales were good," said Canaccord Adams analyst Peter Misek.

Six million customers have downloaded the new iPhone 3.0 software in the first five days since its release, Apple said.

"Customers are voting, and the iPhone is winning," Jobs said in the statement. "With over 50,000 applications available from Apple's revolutionary App store, iPhone momentum is stronger than ever."

In the past, Apple declined to comment on reports on Jobs' health, saying only that it expects him to return to work by the end of the month as planned.

(Writing by Tiffany Wu; Editing by Gerald E. McCormick and Lisa Von Ahn)

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