Apple clearly thinks X marks the sweet spot for consumers.
Apple said Thursday it expects sales for the upcoming holiday quarter of between $84 billion and $87 billion, as the $999 iPhone X finally hits the market.
The projected revenue generally exceeded Wall Street’s expectations, potentially easing concerns about rumored supply constraints for the new high-end smartphone. It would also set a new quarterly sales record for the company.
Apple stock popped as much as 3% in after hours trading Thursday. If those gains hold when the market opens, Apple would approach a $900 billion market cap.
Apple announced two new phones in September: the iPhone X and the more affordable iPhone 8. The 8 went on sale at the very end of the most recent quarter. The X goes on sale Friday.
On a conference call with analysts Thursday, Apple CEO Tim Cook said pre-orders for the iPhone X have been “very strong.” He cited early reports of lines forming outside its stores ahead of the launch.
When asked about the unusually high price tag for X, Cook suggested it amounted to a few coffees a week, when broken down.
“Look at the U.S. carriers. I think you would find you could buy an iPhone X for $33 a month,” he said. “That’s a few coffees a week. Less than a coffee a day at one of these nice coffee places.”
The X is the first iPhone in several years with a redesigned look. It has a giant screen, no home button and lets you unlock it by scanning your face.
Cook said he was encouraged by Apple’s ability so far to ramp up production of the iPhone X, given its new features.
“We’re going to get as many of them as possible to the customers as soon as possible,” he said.
The release of iPhone 8 and 8 Plus have been somewhat overshadowed by the upcoming IPhone X launch, with reports suggesting demand for the 8 could be weaker than expected.
Cook stressed that the devices have been selling well, but admitted the staggered launch of two new iPhone models marks a new approach for the company with certain unknowns.
“We’re gonna learn something,” Cook said.
Even without the iPhone X on the market, Apple’s smartphone sales are growing.
Apple sold 46.7 million iPhones in the three-month period ending September 30, up 3% from the same quarter a year earlier.
The increase in iPhone sales, combined with an 11% increase in iPads sold and continued growth in sales from services like Apple Pay and iCloud, helped push up Apple’s overall sales by double-digit percentages.
Apple’s sales for the quarter hit $52.6 billion, up 12% from the same quarter a year ago.