Apple Inc fans queued around city blocks worldwide on Friday to get their hands on the new iPhone 5, pointing to a strong holiday season for the consumer device maker despite grumblings about the mapping app in the new smartphone.
The iPhone 5 — thinner, lighter and with a 4-inch screen — went on sale in stores across the United States, Europe, Asia and Australia, with mobile carriers reporting record demand that looked likely to stretch Apple’s supply capacity.
“The line for the iPhone 5 was 70 percent greater than the line for the iPhone 4S despite Apple taking two (times) as many online pre-orders,” said Piper Jaffray analyst Gene Munster. He expects Apple to sell 8 million of the new smartphones over the weekend.
The long lines of excited buyers prompted optimism on Wall Street. Deutsche Bank raised its target on Apple stock to $850 from $775, saying “demand indicators are tracking very strongly.”
The iPhone is Apple’s highest-margin product and accounts for half of the company’s annual revenue. Apple shares were up 0.5 percent to $702 in afternoon trading in New York.
JPMorgan estimates the phone could provide a $3.2 billion boost to the U.S. economy in the fourth quarter – a boost almost equal to the whole economy of Fiji.
Apple’s rival and component supplier, Samsung Electronics Co, tried to spoil the party, saying it plans to add the iPhone 5 to its existing patent lawsuits against Apple.
Apple began taking pre-orders for the iPhone 5 last Friday and booked more than 2 million orders in the first 24 hours – double the first-day sales of the previous iPhone, the 4S. Shipping time for online orders is three to four weeks.
Prices for the iPhone 5 start at $199 for a 16 GB model and range as high as $399 for a 64 GB model.
As Apple began delivering the new phone, struggling competitor Research in Motion, which makes the BlackBerry, had to admit that it was once again having service problems in Europe, the Middle East and Africa.
The iPhone 5 supports faster 4G mobile networks and also comes with a number of software updates, including Apple’s new in-house maps feature, which is based on Dutch navigation equipment and digital map maker TomTom’s map data.
But not everyone was impressed. Some users criticized the maps feature for a number of geographical errors, missing information, and a lack of features.
And not everyone was thrilled with Apple’s success.
Hundreds of French iPhone fans lining up at Apple’s main store in Paris got an earful from disgruntled store employees and others protesting against Apple policies.
Marching in front of the Paris store were about 20 former staffers…
Read more: Reuters