A Million Reasons Why Investors Should Love the iPhone 4S

Remember that initial reaction of disappointment that many -- myself included -- had when Apple (Nasdaq: AAPL  ) unveiled the iPhone 4S?

I had acknowledged that the disappointment really only had to do with expectations and perception, while the iPhone 4S was likely to maintain the company's trajectory of sales growth. I had said that "only coming out with a 4S promotes the perception that Apple is getting lazy or falling behind when in actuality, it's not," and that "the iPhone 4S should at least be able to maintain Apple's current course."

Apple put out a press release today announcing that iPhone 4S preorders exceeded one million in just the first day, besting last year's single-day preorder record of 600,000 achieved by the iPhone 4.

Apple's senior vice president of worldwide product marketing, Phil Schiller, who also did the unveiling, said, "We are blown away with the incredible customer response to iPhone 4S. The first day preorders for iPhone 4S have been the most for any new product that Apple has ever launched and we are thrilled that customers love iPhone 4S as much as we do."

The first iPhone introduced in 2007 took 74 days to reach 1 million units sold. The iPhone 3G and 3GS each broke a million within the first three days of launch weekend. Last year, the iPhone 4 launch weekend topped 1.7 million iPhones sold. With the new preorder record set by the iPhone 4S, Apple already has a significant head start to top 1.7 million this coming weekend.

The margins that Apple will likely enjoy on the 4S will be even greater than last year's model. Deutsche Bank analyst Chris Whitmore is pegging manufacturing margins north of 70% as carrier subsidies are probably in the ballpark of $450, higher than what most Google (Nasdaq: GOOG  ) Android devices  -- like the Motorola Mobility (NYSE: MMI  ) Droid Bionic and HTC Thunderbolt -- tend to collect.

Apple keeps a reservoir for walk-ins on launch day for those who didn't think ahead and preorder. After all, Apple loves putting on a good show as much as the next company, and iPhone launches have become a media holiday. Last year's iPhone 4 launch was an absolute stampede, and this year's launch is stacking up to be just as frenetic.

If you haven't already, add Apple to your watchlist to see how many iPhones get sold this launch weekend.

Fool contributor Evan Niu owns shares of Apple, but he holds no other position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Apple and Google. Motley Fool newsletter services have recommended buying shares of Google and Apple, as well as creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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