NEW YORK (AP) -- Apple shares slipped in early trading Tuesday after AT&T Inc., the largest seller of iPhones in the U.S., reported a sharp drop in first-quarter sales compared to the holiday quarter.
Apple is set to report another record quarterly profit for the January to March period after the market close Tuesday.
In its first-quarter report Tuesday morning, AT&T said it activated 4.3 million iPhones in the first quarter, down from 7.6 million in the fourth quarter, which saw the launch of the iPhone 4S. However, the number was still up from the 3.6 million iPhones AT&T sold in the same quarter a year ago.
Analyst Brian White at Topeka Capital Markets said the drop in AT&T's figures wasn't very significant, considering the wide international distribution of the iPhone 4S. He still believes Apple will report selling 29.6 million iPhones in the January to March period, its fiscal second quarter.
White is an Apple bull, with the highest price target for the company among Wall Street analysts: $1,001.
Wall Street analysts expect Apple Inc. to post a profit of $9.2 billion. That's roughly in line with the profit expected from the world's largest oil company, Exxon Mobil Corp.
The majority of the profit will come from iPhone sales, especially now that three of the four national U.S. wireless carriers —AT&T, Sprint, and Verizon— sell the phone.
Shares of Apple Inc. fell $5.76, about 1 percent, to $565.94. Shares had been up in premarket trading before the AT&T report.