Analyst cuts estimate for iPad, raises for iPhone

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SAN FRANCISCO (AP) — A Canaccord Genuity analyst lowered his estimate for the number of iPads he thinks Apple will sell in the October-December quarter, citing competition from Amazon’s Kindle Fire tablet and the likelihood of a new iPad launch in the spring. He also raised his iPhone sales estimate for the same period, citing strong demand in the U.S. and Western Europe.

Analyst T. Michael Walkley said he expects Apple Inc. will 13 million iPads in the current quarter, down 1 million from his previous estimate. Like many industry insiders, Walkley expects Apple to launch a new version of its popular tablet computer in the March quarter. That could cause some consumers to hold off on purchasing the device this holiday season.

He added that Amazon.com Inc.’s recently released Kindle Fire tablet has increased competition. The device, which at $199 is less than half of the $499 Apple charges for its cheapest iPad, is seen as one of the first real challengers to Apple’s dominance in the swiftly-growing market for tablet computers.

Walkley also increased his estimate for iPhone sales in the quarter ending this December by 1.5 million to 30.5 million. The analyst said iPhone sales were solid in the U.S. last month, and the smartphone was gaining market share overseas against phones running Google Inc.’s Android software.

The introduction of the latest iPhone in new markets such as China, Brazil and Russia during the quarter should also help sales, he said.

Walkley rates Apple shares “Buy” with a $560 price target.

Apple shares fell $1.91, less than 1 percent, to $391.10 in afternoon trading, while Amazon shares dropped $4.83, or 2.5 percent, to $191.41 and Google shares shed $2.65, less than 1 percent, to $623.