NEW YORK -- Problems with Apple Inc.'s new maps feature have been well publicized and reported over the past week, but Sterne Agee analyst Shaw Wu says demand for the iPhone 5 remains "robust."
Apple released an update to its iPhone and iPad operating system last month that replaced Google Maps with Apple's own map application. But users quickly complained that the new software offered fewer details, lacked public transit directions and misplaced landmarks, among other problems.
Still, Wu said he has "not picked up changes" in plans for the iPhone along Apple's supply chain.
"Demand appears robust with its online store quoting a lead time of 3-4 weeks," he wrote in a note to investors.
Instead of demand, the bottleneck appears to be production itself, Wu added. That's because the iPhone 5 is not easy to build and Apple "has very high standards where it aims to produce each model to be an exact replica where variance is measured in microns."
Like Apple and other analysts, Wu also noted that Apple's maps app will get better over time.
"People forget that (Google) Maps started out inferior to (Yahoo) Maps and MapQuest," he said. "From our understanding, (Apple) had no choice but to produce its own Maps as (Google) wanted to keep turn-by-turn navigation unique to Android. We see this as short-term pain for longer-term gain."
Turn-by-turn navigation was one of the most asked-for features that Apple added to the maps on the iPhone and iPad. Google Maps only offers that on Android devices.
Shares of Apple rose $1.92 to close at $661.31 on Tuesday and added $1.49 at $662.80 in after-hours trading.