Verizon Might Owe Apple $14 Billion for Unsold iPhones

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News Posted: Sun, Jul 14 2013 9:42 AM
You know the saying, "Be careful what you wish for?" Well, Verizon Wireless once wished upon a star that it could join the iPhone party, which at the time was exclusive to AT&T. Apple ultimately granted Verizon its wish, and according to an older filing with the Securities and Exchange Commission (SEC), Big Red may owe the Cupertino company a lot of money for unsold iPhone devices.

Analyst Craig Moffett of Moffet Research wrote in a research note that Verizon's iPhone sales haven't kept up with its promised commitment with Apple, noting that the wireless carrier would have to sell $23.5 billion worth of iPhone devices this year to make good on its deal, The Wall Street Journal reports. Verizon sold less than half that amount in 2012, and according to Moffett, Big Red could end up owing $14 billion.

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Apple and Verizon haven't shared any details of their iPhone arrangement, and Moffett had to do some digging to uncover the above info. Specifically, he combed the footnotes of a 2011 SEC filing by Vodafone Group, which owns a 45 percent stake in Verizon.

All this could be much ado about nothing. Moffett acknowledges "it's unlikely that Verizon would simply have to write a check for the difference," but there could some kind of penalty involved.
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14B? That's no chump change...sounds like they're goona have a limp for awhile.

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They took a large bet and it didn't pay off. Too bad this didn't happen to AT&T. Verizon is going to be more reserved and less likely to take chances for awhile.

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At first I thought it said 14 Million...but then when I realized it was Billion...Holy Crap!!! That is a lot of money even for a giant like Verizon.

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ajm531 replied on Mon, Jul 15 2013 11:51 PM

i doubt the will stop selling it but apple needs to be careful as well. Agreements like these could cause them to lose favor with carriers and thereby making harder for apple to get another agreement like it and therefore getting backlash to where that carrier(being verizon in this case) may not want to sell it for them.

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