Consumers Still Love Last Year’s iPhone

With the iPhone 5’s October launch fast approaching, you’d expect demand for the iPhone 4 to be waning. Why invest in a smartphone that’s over a year old now when you can wait a few weeks and buy its brand-new successor? Or so the logic goes.

Evidently the market is not buying into that logic. Because according to Stern Agee analyst Shaw Wu, iPhone 4 sales remain surprisingly strong, despite the device’s advanced age and a widely anticipated October refresh.

“The biggest surprise we are picking up is unexpected strength in Apple’s iPhone business,” Wu said in a note to clients. “The reason why this is remarkable is demand for iPhone 4 remains fairly robust despite it being well known that there will be an upcoming iPhone 5 refresh. We had modeled a sizeable quarter-to-quarter decline to reflect a pause and inventory drawdown ahead of a refresh and we now think this is conservative.”

Accordingly, Wu has revised his iPhone estimate for Apple’s last fiscal quarter of the year, raising it to 18.5 million from 15.7 million. That’s less than the 20.34 million iPhones the company sold in its third quarter, but it’s impressive just the same.

And Wu is not alone in noting strong continuing demand for the iPhone 4.

Last week, Canaccord Genuity analyst T. Michael Walkley noted that the device remains one of the top-selling smartphones in the U.S.

“Our checks indicated strong sales of the iPhone 4, as it remained the top selling smartphone at AT&T and Verizon despite increasing consumer expectations for the iPhone 5 launch,” he wrote. “During the holiday season, we anticipate strong sales of the iPhone 5, as we anticipate a strong global launch with increased distribution to new carriers including Sprint in the U.S. market.”

Astonishing demand for a smartphone that’s been on the market for a year now, but that’s perhaps to be expected. After all, the iPhone 3GS is two years old, and it’s still selling well at AT&T.