Long lines outside Apple stores lifted hopes on Wall Street that the company had a record sales launch for its new iPhones this past weekend.
The high-end iPhone 5s and the cheaper iPhone 5c went on sale in the U.S., China and nine other territories on Friday. Investors are watching closely because Apple shares have slumped by a third in the past year amid questions about the company's strategy and rising competition in the smartphone market.
Apple stock closed Friday at $467.41, down 1.04%.
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"Lines lingered well into the weekend," Brian Marshall, an analyst at ISI Group, said Sunday evening. "Demand was solid across the board."
He's expecting Apple to have sold a record 6 million iPhones over the weekend, up 20% from last year, when the company sold 5 million iPhone 5 models the first weekend — the previous record for a launch weekend.
Analysts at Cowen & Co. are expecting launch weekend sales of 7 million to 8 million units.
"We view this number as doable, certainly at the low end of that range," the Cowen analysts, led by Timothy Arcuri, wrote in a note to investors. "Our team observed very long lines throughout both (New York) and Boston."
Daniel Ernst, a tech analyst at Hudson Square Research, surveyed 98 consumers in line at 14 locations in Connecticut, Georgia, New York City, and upstate New York, and found lines "somewhat longer" than last year's iPhone 5 launch.
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This launch weekend has more potential than last year's because Apple put the phones on sale in China at the same time as the U.S. for the first time. Also, wireless carrier NTT DoCoMo was on board in Japan for the first time, and T-Mobile had the phones in the U.S. Meanwhile, the existing base of iPhone users is bigger than it was a year ago, the Cowen analysts explained.
The more-expensive iPhone 5s, which comes with a fingerprint sensor and faster processors, saw the most demand. All 5s models — the gold, silver and "space gray" colors — were listed on Apple's website Sunday evening as available to ship in October. The cheaper 5c phone was available to ship within 24 hours, according to the website.
Shoppers lined up for hours at the flagship Apple store in Palo Alto beginning at 6.30 a.m. PT Friday. Most wanted the gold iPhone 5s model, but that quickly sold out, followed by the silver 5s.
That sparked concern that supply constraints could limit weekend sales. Apple spokeswoman Natalie Kerris said Friday that demand was "incredible" and added that the company had sold out or had limited supply of certain 5s models in some stores. Kerris declined to comment further Sunday.
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"Supply was clearly the issue, but I think 6 million is doable," said ISI's Marshall. "If they had more supply, they could have undoubtedly sold a lot more."
Some people, far from decrying long lines, made a day of it. Apple CEO Tim Cook greeted shoppers at the flagship Apple store in Palo Alto, dropping in for about 15 minutes early Friday morning.
—By Alistair Barr of USA Today