Apple says it aims to sell 10 million iPhones in 2008, amounting to a 1 per cent share of the global market, but has not given a goal for the device's launch.
"They want to extend the dominance they have in terms of their ability to create really elegant hardware and software integration," said Mark McGuire, an analyst with research firm Gartner.
"This is the next big business unit for them."
The iPhone launch is also viewed as a test of wider US demand for advanced phones, which have already caught on in parts of Asia.
Technology analysts have praised the iPhone, which combines phone, web browser and media player, as a "breakthrough" device, but have suggested users might have difficulty with its touch-screen, instead of a keyboard, and sometimes slow internet connection.
Apple is expected to sell the iPhone in Europe later this year in the run up to the holiday season.
It has not disclosed the price or the carrier, though speculation has mounted it may reach a deal with Britain's Vodafone Group.
Sales in Asia are expected to begin sometime in 2008.
Apple's rival, Palm Inc, has said the iPhone could hurt demand for its Treo smartphone, at least in the short-term.
"It's likely that as people try [the iPhone] out, there may be some stall in our sell-through," Ed Colligan, Palm's CEO, said on Thursday.
Shares in Apple have gained more than 30 per cent since Steve Jobs, Apple's CEO, unveiled the phone in January.
Many analysts say Apple stock could climb as much as 30 per cent again in the coming year if the phone catches on, but some cautioned that the shares are already richly valued because of the high expectations.
Not everyone was taken with Apple's new product, however. In San Francisco a construction worker, driving by an Apple store in his pick-up truck, yelled at the waiting crowd: "It's just a phone!"