New iPhones hit stores as Cook faces growth questions

How many iPhones can Apple sell? That's a question facing Chief Executive Officer Tim Cook as the latest batch of handsets began reaching stores worldwide on Friday. The company has hit sales records with each annual release. Yet, the newest models, following a hugely popular design overhaul last year, might not match the success of previous releases, analysts say.

From Sydney to New York, some of the Apple faithful waited in queues for more than two weeks to be among the first to receive the new iPhone 6s and 6s Plus.

Before the new iPhones went on sale, the demand appeared lower than last year, "possibly meaningfully so", said Andy Hargreaves, an analyst at Pacific Crest Securities. Analysts at Sanford C Bernstein & Co and RBC Capital Markets raised concern about iPhone growth. Since 2013, iPhone sales have increased an average 35 per cent each quarter. Between October and December last year, Apple sold 74.6 million iPhones, about 34,000 an hour.

Expectations are tempered partly because the gadget is at a point in its two-year design cycle that entails less dramatic changes. In the first year, Apple generally overhauls the device's hardware, including its look and feel. For the following year's model, designated with an 's' tacked on to the number, the company makes more subtle improvements.

The iPhone 6s and 6s Plus resemble last year's versions but sport new features such as 3D Touch, which provides a shortcut for checking mail, taking pictures and other functions when the user presses down on the screen. Apple also added an improved camera and zippier processor.

On Friday, the new handsets hit stores in New Zealand, Australia, Japan, Singapore, China, Hong Kong, France, Germany, the UK, Canada, the US and Puerto Rico. They will go on sale in about 130 countries by the year-end, Apple has said.

At New York's flagship store on Fifth Avenue, Jaime Gonzalez took two weeks off from work to wait in queue for 16 days. "I never had an iPhone before," said the 38-year-old truck driver. "I see all my friends playing with their iPhones and new devices, and I said, 'You know what, maybe it's time for me to upgrade,"' said Gonzalez.

Customers around Asia lined up to be among the first to get their hands on the device. Stores in China, Apple's largest market outside the US, drew faithful buyers such as Wu Kai, who picked up two phones from a packed Apple outlet at Beijing's Xidan Joycity mall.

"Apple products are becoming family members," the 17-year-old student said, explaining how he and his parents relied on every Apple product from the Mac Pro to the iPad. "It's just a good product that's shaping our everyday life."

Cook has said he expects the world's second-largest economy to eventually become Apple's largest market. Greater China accounted for 27 per cent of the company's revenue in the June quarter, more than all of Europe, and remains a swing factor for the company's iPhone-reliant earnings.