iPhone 5 "PRO" Concept - Design by Jinyoung Choi
Jinyoung Choi's concept design for the iPhone 5, called the "iPhone PRO," features a 1.2-megapixel 3D camera, a DSLR len mount, a removable hard disk, and a built-in projector. Face down, you can see the slightly curved back and the speakers at the bottom of the device. Courtesy

Many industry analysts have predicted that Apple may face a drop in sales of iPhones, ahead of the release of its next generation iPhone, aka iPhone 5, later this year. But the slowdown in iPhone sales will be short-lived, thanks to the expected high demand for the new iPhone model, which will continue to dominate the smartphone market throughout 2013, according to an analyst's report.

J.P. Morgan analyst Mark Moskowitz said in a note to investors Thursday that the upcoming model of the Apple iPhone should be launched in September, ramping up production throughout the fourth quarter. The highly anticipated smartphone will incorporate support for the 4G LTE connectivity, along with other key upgrades and will propel the Cupertino tech giant to smartphone dominance next year.

We think that a combination of revolutionary hardware enhancements and software-driven services (i.e. Passbook, Maps, FaceTime over cellular) stand to reaffirm the iPhone as the leading smartphone in 2013, Moskowitz wrote in his note.

The analyst, however, believed that it won't be a smooth ride for Apple as the iPhone sales could see a decline prior to the launch of the iPhone 5. Based on significant macroeconomic challenges, Moskowitz cut his calendar-year second-quarter sales and earnings estimates for Apple slightly, suggesting tough times are expected for hardware vendors that could also impact manufacturers like Apple.

Last week, Pacific Crest analyst Andy Hargreaves also predicted that high expectations related to the iPhone 5 among Apple fans all around the world could cause a larger-than-expected pause in buying iPhones ahead of the device's release later this year. However, Hargreaves believed that there would be extraordinary demand for Apple products through fiscal 2013.

Although Hargreaves continued to recommend Apple shares as Outperform, he also added that investors' return expectations should be moderated by the likelihood for slowing replacement cycles, weak macroeconomic conditions and increasing saturation in developed markets through FY 2013.

As regards J.P. Morgan, the firm lowered its projections of revenue from the iPhone sales in the third quarter. However, it shouldn't raise any concern as sales usually plunge ahead of the expected launch of a new model, CNET reported.

Moskowitz dropped his earnings and revenue estimates for the company's June-ending quarter by 0.5 percent and 0.8 percent, respectively. He expected Apple to report fiscal third-quarter earnings of $10.20 per share on revenue of $36.8 billion, MSN Money reported.

Moskowitz said in his note that the holiday season would certainly boost sales of the next iPhone as it did last year, helping Apple sell a record 37.04 million iPhones in the fourth quarter.

Expecting a big turn-around during the fourth quarter, based on anticipated demand for the new iPhone, J.P. Morgan increased its fourth-quarter sales estimates for the new Apple smartphone.

Overall, our expectation of stronger iPhone unit sales and the related mix benefits partially counter our lower growth assumptions for the iPad and Mac businesses, Moskowitz wrote. Still, we think that the company's incremental market penetration opportunities can help the Mac become a major contributor to overall company growth in the coming years.

Meanwhile, the Apple iPhone celebrated its fifth anniversary Friday and according to Strategy Analytics' statistics, ever since the first iPhone launch on June 29, 2007, Apple has shipped 250 million iPhones worldwide, generating $150 billion in cumulative revenues, AppleInsider reported.

The iPhone portfolio has become a huge generator of cash and profit for Apple, said Neil Mawston, executive director at Strategy Analytics. A quarter of a billion iPhones have been shipped cumulatively worldwide in the first five years since launch and Apple reaches its fifth birthday at the top of its game.

The rumors surrounding the iPhone 5 say that the future flagship Apple phone will feature a larger 4-inch Retina display, an A5X Variant chip, 4G LTE technology, Near Field Communication (NFC) and a smaller dock connector.

Other features and specs also include 1GB RAM, iOS 6, improved Siri, liquidmetal casing, an 8 megapixel (or even higher) rear camera, a 2 megapixel front-facing camera for video chatting and a much-improved battery life.

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