Apple iPad 3 Launching in Q2: Analyst

Wedbush Securities expects Apple Inc. to launch the iPad 3 in the fiscal second quarter but other rumors suggest the next-generation of iPad is coming sometime in the next two months.

Apple is expected to release two versions of the iPad 3 at the iWorld (formerly known as Macworld) trade show in San Francisco on Jan. 26, according to the DigiTimes. Other reports speculate the tablet could be unveiled on Feb. 24, the birthday of Apple's co-founder Steve Jobs.

One of the two versions set to be released is reportedly for the high-end segment and the other for the mid-range segment. The new models of the iPad 3 will join the iPad 2, demonstrating Apple's complete iPad series targeting the entry-level, mid-range and high-end market segments.

Substantiating the DigiTimes report, analyst Ben Reitzes of Barclays Capitals said that of the Cupertino, California-based tech giant's speculated two iPads, one will come with better cameras, higher resolution display, the A5 processor and Siri in March and another, later this year, featuring a faster processor and 4G LTE.

We remain comfortable with our iPad estimate, which we believe remains below consensus, with the iPad 3 waiting in the wings. We are maintaining our iPad unit estimate of 13.3 million units. We believe this still remains slightly below Street expectations despite some reductions in those expectations, said Scott Sutherland, an analyst at Wedbush Securities.

On the positive front, Sutherland expects a potential iPad 3 launch in fiscal second quarter to benefit revenue and pressure margins.

In addition, similar to the iPhone, Sutherland expects Apple to address new competitively priced tablets from Amazon and others by discounting the iPad 2 along with the iPad 3 launch.

That said, Sutherland believes Apple should introduce tablets with smaller screens to give consumers a broader choice of sizes and price points.