Charlie Wolf has second thoughts about Apple's iPadJuly 12, 2012: 8:52 AM ET
He's raising his estimate for the June quarter from 13.5 million units to a Street-high 20 million
FORTUNE -- In an note to clients Thursday that was unusually long and detailed for a simple revised estimate, Needham's Charlie Wolf rattled off a list of reasons he thinks Apple (AAPL) sold a lot more iPads in the quarter than ended June 30 than what he confesses was a "hastily formulated initial estimate" published three months ago.
In April, he was looking for sales of 13.5 million iPads -- in line with what a lot of Wall Street analysts were saying at the time.
Now he's expecting Apple to report sales of 20 million units, which is the highest we've seen from any institutional analyst.
What made him change his mind? Among the data points he cites: (I quote)
- 12 NFL teams, including the Cincinnati Bengals, the Denver Broncos and the Baltimore Ravens, have replaced their paper playbooks with iPads
- A growing number of airlines, including United Airlines, have replaced their paper pilot manuals with iPads
- Other airlines, such as British Airways, are using iPads to manage their passenger lists, while still others such as Singapore Airlines and Quantas are using iPads as passenger entertainment centers
- Both the Polish Parliament and Dutch Senate have substituted iPads for paper printouts of the documents read by their members
- The deployment of 26,000 iPads in the San Diego School District, which likely
represents the tip of the iceberg
- One school reported a 10% improvement in the exam scores of students using iPads compared with students using paper books
- In other schools, iPads are not only replacing textbooks but also personal computers
- In China, iPads are finding their way into top-tier high schools
- One quarter of European doctors are reported to already use iPads, a percentage that's forecast to reach two-thirds in a year
- iPads helped restructure $270 billion of Greek debt in record time
- The iPad has found its way into zoos to test the intelligence of primates
- The iPad is undergoing tests in New York taxicabs as a combination entertainment/payment device
- SAP has deployed over 12,000 iPads running applications written by the company
- Level 3 has purchased 1,300 iPads for its sales force, using applications written by Salesforce.com.
"The preceding," Wolf writes, "is a sample of the uses we've read about. We suspect the list is far longer, embracing, for example, travel agencies, real estate firms and restaurants, which are visualizing the products and services they sell."
Wolf writes that his revised estimate is also based on the historical trajectory of iPad sales:
"When iPad 2 was introduced in March 2011, sales increased 97% in the following (June) quarter. Our forecast of 20 million iPad sales in June implies a 70% sequential increase from March. While this number appears aggressive, it must be remembered that Apple has continued to sell iPad 2 at the lower price of $399. A study by Consumer Intelligence Research Partners found that since the introduction of the new iPad in March, iPad 2 has composed 41% of all iPad purchases."
Wolf's new estimate of 20 million iPads not only greater than the most bullish Wall Street analysts, it's higher than the average estimate of our panel of independent analysts. In fact, it puts him in the nosebleed territory of the most optimistic among them. (See How many iPads did Apple sell last quarter?)