Half of the Apple stores on the U.S. West Coast sold out of the devices on the first day, the report said, citing analyst Trip Chowdhry of Global Equities Research in San Francisco.
Chowdhry could not immediately be reached for comment. Apple and AT&T were not immediately available.
Piper Jaffray also estimated first-weekend sales of the iPhone at about 500,000, according to cnet.com.
The iPhone, which combines a phone, Web browser and a music player, went on sale on Friday. About 2 percent of buyers have experienced delays in activating their service, a source said on Sunday.