We’ll soon know if Apple made progress drumming up more demand for the latest iPhones in Asia. Weak demand in China caused a surprising year-over-year drop in Apple’s total revenue during the last quarter of 2018.
CEO Tim Cook and co. have just scheduled an earning call with investors for April 30. We’ll find out then if the company managed to improve its situation during the first three months of 2019.
iPhone sales are down, especially in emerging markets. The reason is simple: Apple’s devices cost too darn much. And the solution is equally simple: Apple must make a new budget model. In short, it needs a successor to the iPhone SE to ensure short-term profits as well as long-term viability.
This device has to have a low, low price. Even if that means a phone so bare-bones that most Americans turn up their noses at it.
Americans about to purchase a handset are far more interested in an iPhone than in devices running the rival Android OS, according to a survey done by an industry analysis firm.
But the news isn’t all good for Apple. The same survey found only moderate interest in the company’s rumored streaming video service.
China is not the only part of the world where Apple’s iPhone is losing market share to hard-charging Chinese brands.
Sales of the iPhone are falling off in Europe and Thailand, the second-biggest smartphone market in Southeast Asia, where shipments fell by more than 50 percent.
The days when people bought a new iPhone every two years are over, according to an industry analyst. In fact, many people are holding on to their handsets for twice that long.
That’s bad news for Apple’s bottom line, as faster upgrades mean more profits.
Apple’s last quarter was so bad the company broke its long-running streak of outselling Samsung during the holiday gift season.
Going back for several years, the maker of the Galaxy line of Android handsets always outsold Apple during the first three quarters, and in total sales for the whole year, but iPhone would came out on top in Q4. Not last quarter.
Not included in the Q4 financial results Apple just announced was the number of iPhone units sold. An analyst firm quickly filled in the gap, estimating that 65.9 million iOS handsets shipped in the last quarter of 2018, down significantly.
This is the first quarterly earnings announcement in which Apple didn’t reveal how many iPhone, Mac, and iPad units it had sold.
When Apple unveils its earnings report for last year’s crucial holiday quarter, the entire world will be watching for signs of the company’s long-rumored impending doom.
Several factors will make Tuesday’s Q1 2019 earnings call Apple’s most important in years. Depending on how it goes, it could have an enormous impact on the company’s stock’s performance in 2019 and beyond.
Ming-Chi Kuo, a tech analyst with a decent record for accuracy, predicts Apple will sell more iPhones in 2019 than many other analysts are anticipating.
To be clear, Kuo isn’t predicting a banner year for iPhone sales. Just not a terrible one.
Apple CEO Tim Cook has repeatedly said the company would rather make the best smartphone than the cheapest.
Yet, Apple’s budget model iPhone XR sold more in the U.S. during the fiscal quarter that ended in December than the iPhone XS and XS Max combined, according to new research.
The Chinese phone market cratered in the final quarter of 2018, but iPhone sales in the country did even worse.
This poor showing is primarily a result of the high prices Apple charges for its handsets, according to an industry analyst.
A recent unconfirmed report indicated that Foxconn, who produces handsets for Apple, had laid off thousands of employees. But the company itself says it’s actually hiring 50,000 people, a sign that iPhone sales aren’t a weak as some fear.
Still, there are indications of a slowdown in Foxconn production, just not a dramatic one.
Slumping iPhone sales have caused Apple to rethink its hiring strategies for certain division.
During an employee meeting earlier this month, Tim Cook was asked if the company is about to go on a hiring freeze. Cook reportedly responded that a total hiring freeze wasn’t a solution, the company would reduce hiring in some areas.
Sales of iPhones seem to be weaker than in previous years, and the Chairman of the Federal Reserve has an explanation: a drop in consumer spending in China.
The implication is that the slowdown in iPhone sales isn’t a result of anything Apple has done.
The iPhone XR is Apple’s newest handset but more of its units are already in use than the iPhone XS which launched two months earlier. And the XR is on course to pass the XS Max in the near future.
That said, all three are still trailing the installed base of 2017 iOS models, especially the iPhone X.
Apple CEO Tim Cook warned investors today that weak iPhone sales could translate into revenue shortfalls in the billions of dollars.
Cook blames the expected revenue drop on fewer-than-expected iPhone upgrades and weakened demand in China.
The iPhone XR got off to a fairly strong start. In November, this just-launched model made up 30 percent of Apple’s U.S. sales, slightly higher than the iPhone X in Nov. 2017.
But the standout aspect of the XR’s launch is this new model drew in a higher percentage of Android fans than any Apple device in years.
2019 isn’t shaping up to be an good year for Apple. A survey of potential customers in the U.S. and in China found lower interest in iPhone than last year.
The iPhone turned in a “flat” third quarter while Chinese brands Huawei and Xiaomi droves sales in their home country to grow their shares of the global smartphone market.
The smartphone market grew by 1.4 percent to reach 389 units. Take Huawei and Xiaomi out of the equation, and global sales would have declined by 5.2 percent, according to the research firm Gartner, Inc.
In a change for Apple, its best-selling model isn’t its most expensive. A company VP says the iPhone XR has outsold the iPhone XS series since the cheaper device came out last month.
Perhaps this will allay recent nervousness about how well Apple’s latest device is selling.
Goldman Sachs has added its name to the list of financial institutions worried about stagnating iPhone sales.
“We are concerned that end demand for new iPhone models is deteriorating,” Goldman Sachs wrote in a new note to clients. The firm estimates that Apple will produce 6 percent fewer iPhones next year than it did in the year previous. However, the big investment banking company admits it could be jumping the gun.
Respected Apple analyst Ming-Chi Kuo just slashed his estimates for the number of iPhone XR units that will sell over the next year. That’s a real turnaround, as Kuo had previously been bullish on Apple’s latest handset.
And he’s not the only analyst expressing concerns about sales of the iPhone XR. But it’s also possible this model is just following a pattern first laid down by the iPhone X.
The three Asian companies that assemble the iPhone XR have reportedly reduced production. Apple is ordering fewer units because sales of this smartphone haven’t lived up to expectations.
However, the source for this information isn’t the most reliable.
Apple just posted its Q4 2018 earnings report and, per usual, it was another record-breaking quarter for the iPhone-maker.
Revenue and iPhone sales came in slightly higher than Wall Street’s expectations, while Services revenue hit an all-time high of $10 billion. Another record-breaking quarter looks like it’s on the horizon, too. Apple CEO Tim says the company is heading into the holiday season with its strongest lineup ever.
Respected analyst Ming-Chi Kuo thinks the iPhone XR is going to be a massive smash hit for Apple — and it seems everyone is being taken by surprise by how in-demand it will be.
In a recent note to investors, Kuo increased his estimate for fourth-quarter iPhone XR shipments by 10 percent. Instead of 33 million to 35 million iPhone XR units over the quarter, he now thinks Apple’s suppliers will ship out 36 million to 38 million units.