Verizon Seen Owing Apple Up to $14 Billion for IPhones
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Verizon Wireless may end up owing Apple Inc. as much as $14 billion in purchase commitments over time if the mobile carrier fails to sell an agreed number of iPhones, a report from Moffett Research LLC said.
Under a multiyear deal signed with Apple in 2010, Verizon Wireless is obligated to buy $23.5 billion worth of iPhones in 2013 alone, according to Craig Moffett, a telecommunications analyst who left Sanford C. Bernstein & Co. earlier this year to start his own research firm. Since the purchase commitment is more than twice what Verizon Wireless sold in 2012, the company may have a shortfall of $12 billion to $14 billion, worth $4 to $5 per share, Moffett said in the report.