Motorola Inc. probably sold 100,000 Droid phones in their first weekend on the market, a sign that the handset maker is recovering even though it still trails Apple Inc., an analyst said.
Verizon Wireless, the carrier for the device, had 200,000 Droid phones on hand, and most stores sold at least half of their stock, Mark McKechnie at Broadpoint AmTech Inc. said yesterday. Including other models, Motorola will sell 1 million phones based on Google Inc.’s Android software in the fourth quarter and 10 million in 2010, he said.
Motorola and Verizon are competing against a new version of Apple’s iPhone, offered in the U.S. through AT&T Inc. Apple sold more than 1 million of the latest model in its weekend debut in June. Motorola’s share of the global phone market dropped to an estimated 4.7 percent last quarter from about 5.5 percent in the second quarter, the company said last month.
“I see the first few days as encouraging,” McKechnie said. “There seems to be pretty good demand -- they’ve taken the right steps and picked a good partner with Google on the Android side.”
Motorola, based in Schaumburg, Illinois, rose 6 cents to $9.04 at 9:54 a.m. in New York Stock Exchange composite trading. Before today, the stock had more than doubled this year.
The Droid, which uses Google’s Android operating system, went on sale Nov. 6 on Verizon’s Web site and in retail stores. It costs $199.99 with a two-year agreement after a $100 mail-in rebate. Apple’s basic iPhone costs $99 with AT&T, while its newer 3GS model costs $199.
‘Much Anticipated’
Verizon and Motorola ads demonstrate Droid features that aren’t available on the iPhone, including running more than one application at a time and allowing users to swap batteries on the go.
The debut of the Droid was “exciting given its much anticipated arrival,” said Motorola spokeswoman Jennifer Erickson, who declined to comment on sales numbers. Natalie Kerris, a spokeswoman for Cupertino, California-based Apple, didn’t return an e-mail seeking comment.
The Droid’s release is a step in the right direction for Motorola, said Jim Suva, an analyst at Citigroup Inc. in San Francisco.
“It wasn’t as good as the iPhone, but anybody that was expecting that had their expectations too high,” said Suva, who recommends buying Motorola shares. Traffic in Verizon stores through the first three days was “continually good,” he said.
Motorola may sell 1.3 million Android phones in the fourth quarter and 9 million next year, Suva said. Apple will sell 8 million iPhones this quarter and 28.5 million next year, he predicts.
Smartphone Demand
Shipments of so-called smart phones, which allow users to surf the Web and compose e-mail messages, climbed 4.2 percent to 43.3 million in the third quarter from a year earlier, according to market researcher IDC.
Still, as unemployment climbs to the highest level since 1983, carriers may have a tougher time persuading customers to sign up for the pricier data plans that come with smart phones, MKM Partners analyst Tero Kuittinen said in an interview.
“I have this nagging suspicion that Android is being overestimated by technology enthusiasts,” said Kuittinen, who is based in Greenwich, Connecticut. He advises investors to sell Motorola shares, which he doesn’t own. “They haven’t really resonated with average consumers.”
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