Apple Lowers Revenue Guidance for Q1 2019 Citing 'Fewer iPhone Upgrades' Than Anticipated

[sinsin07]

Wonder what the real reason(s) is/are.
Email (see below) and actual article headline upon opening.
View attachment 813729 https://www.nytimes.com/2019/01/02/technology/apple-revenue-decline-china.html

Some additional info from NBC interview:
“Apple blamed a variety of factors for the lowered guidance, including a weakening economy in China and lower-than-expected iPhone revenue. Apple said the lower-than-anticipated revenue happened “primarily in Greater China,” but also said that upgrades to new iPhone models in other countries were “not as strong as we thought they would be.”

It’s pretty telling when you become trapped in your own RDF.

 

[DanGoh]

Got the battery replaced on my 7 last week and willing to wait another year. Would have liked to have gotten an XR but what I am I really getting for another $800?

 

[Spoon!]

I'm on Pixel 2 and had original Pixel. Have never had to plug the phone into my computer once. I don't even know if Google makes a Mac app. I don't miss the days of finding my cable and have to launch iTunes to do something.

I really couldn’t care less that you didn’t plug it into your computer. Many people do. There is a universe outside your bubble. I had an unlocked Pixel 2 and plugged it into my computer. It was rooted and I always kept the OS image handy in case I needed to restore it like an iPhone. Just because you don’t find a use for something doesn’t mean everyone is the same. The not being able to plug in your phone out of the box is a pretty common complaint.

 

[KPOM]

The world is experiencing an economic slowdown. The US stock market had the worst December in many years. The China situation is largely due to trump's idiotic trade wars. Apple is in a great position to ride this out. It's a minor bump for this large a company. They certainly are not showing the type of insane panic you'll see on Mac Rumors.

The China situation is a lot worse than that. They depend on insanely high economic growth but have reached a point where it is unsustainable. The trade wars aren’t helping, but we may get a long term benefit if China agrees to some significant concessions to end them (e.g. ending forced technology transfers).

 

[furi0usbee]

I blame the consumer. When will we say enough is enough. On the one hand we say wow, look at how powerful these phones are. They are like computers in your pocket. Yet, we feel the need to throw them away and buy new ones every year/every other year? If people bought products based on need and now want, that would force companies to add value, not just make superficial changes and mild improvements. A $1000.00 phone should last, if you so let it, many years performing it's job. Basically we are in a subscription service with these companies, but the instead of paying $10/mo here and there, you're effectively paying hundreds per month, not just for the phone, but for the services that go along with it, then the subscriptions for apps that go with the phone. And some wonder why this country is saddled with credit debt.

 

[budselectjr]

So they got burned on China. Gotta be careful depending on China sales too much and what their government says about their economy.

 

[Carnegie]

5.00 billion shares outstanding on 9/30/18 and the Shareholder's letter expected 4.77 billion shares outstanding. Here's a link to past outstanding shares.

https://www.macrotrends.net/stocks/charts/AAPL/apple/shares-outstanding

That 5.00 billion number isn't correct. That would have been the average number of diluted shares for all of FY 2018.

It was 4.915 billion shares outstanding as of 4/20/18, 4.830 billion as of 7/20/18, and 4.745 billion as of 10/26/18.

It was 5.068 billion diluted shares average for the March quarter, 4.927 billion for the June quarter, and 4.848 billion for the September quarter. It's now expected to be 4.77 billion for the December quarter. So the pace of share repurchases either stayed about the same or slowed. I think many expected the pace to pick up with the large decline in the share price over the last two months of the quarter.

 

[Spoon!]

My point is that it is no longer required. When the iPhone came out, using iTunes was the only way to activate it, back it up, etc. Today iCloud backups are now preferred (and iTunes backups don’t back up the apps anymore). What I don’t understand is why Apple doesn’t ship the iPhone standard with the 18W USB-C charger and cable. It’s laughable to ship with a 5W USB-A charger that takes hours to fully charge the phone.

Yes it is required. Especially if you have 300 GB worth of data on the phone like me. Uploading to the cloud can be very slow and not everyone wants to pay for cloud storage ... and I have bandwidth caps in my area for internet. Your point isn’t a point at all. You just have tunnel vision.

 

[JPack]

China is offering strong competition from Huawei. Chinese consumers are switching to Huawei because it's a tech equivalent of an iPhone and because of nationalism.

Huawei is growing by double digits and Apple is cutting it's guidance. It's pretty obvious where the change is coming from.

 

[furi0usbee]

I really couldn’t care less that you didn’t plug it into your computer. Many people do. There is a universe outside your bubble. I had an unlocked Pixel 2 and plugged it into my computer. It was rooted and I always kept the OS image handy in case I needed to restore it like an iPhone. Just because you don’t find a use for something doesn’t mean everyone is the same. The not being able to plug in your phone out of the box is a pretty common complaint.

LOL I used to be in *your* universe. I'm simply saying with iPhone I had to plug, with Pixel I didn't. Ever. Geesh!

 

[ronwasserman]

Its would be great it they'd focus on computers 'Mac Pro' for example, instead of just phones.

 

[iMcLovin]

Not so strange, it seems like Apple is using their customers as guinea pigs currently...how far can we raise prices before people stop buying our products. I think they have reached their peak of lack of innovation and price raise in one generation with this years iPhones.

 

[dogslobber]

I bought a Mac Mini for $1k last quarter so I’ve done my part to prop up the AAPL stock price. Have you done your duty?

 

[Spoon!]

LOL I used to be in *your* universe. I'm simply saying with iPhone I had to plug, with Pixel I didn't. Ever. Geesh!

I’m in the universe in which I have a use for both iCloud and iTunes. Anyway, enough of this off topic nonsense.

 

[nt5672]

Great explanation, unless one takes into account the number of products that have languished without updates, the number of products that were released with serious bugs, the number of products that are not what professional Apple users want, the number of products that were announced and never delivered, the number of features that scream "I'm a toy", etc.

 

[Jdmr1701]

Apple now offers a much larger product line then they used to. There use to only be 1 iPhone now there are 3 for this year alone. The iPhone XR is a damn good phone. I agree pricing on some of there products are too high, or there was no need to raise them like from Pencil 1 $99, to pencil 2 $129. However you don't need to have the flagship best phone or computer or iPad and complain about prices. Those prices have gone up yes, but I can get a brand new iPad 128GB for $430 plus tax right now, the original iPad sold for $600 for 32GB. They used to only offer one kind of iPad now they offer two sizes of the "pro", the standard 9.7", the mini and one year older iPad pro 10". It's not exactly the same thing when you compare a single devices price from over 10 years ago to the largest most expensive one they offer now. Don't buy the flagship if you are worried about pricing, can't afford it, or hold onto your older device which hold up better then they used to. Some people will want and can afford to buy the "pro" versions, some can't.
I am more critical of Apple in recent years, I think they QC needs to be better and stop releasing things just for the sake of releasing things. However then people are upset that Apple is holding back and investors sell stock. Its a loose-loose sometimes.

 

[falainber]

And I thought Apple stopped providing iPhone sales numbers because they transformed into a services company not because they expected iPhone sale troubles. What gives?

 

[FriendlyMackle]

Those $399 were a subsidized price in a way the $749 for the XR are not.

Also, why was the original iPhone the "flagship"? There was only one model. The original iPad was also $499, and its successor these days is the $329 iPad. That doesn't make that the flagship. Nothing wrong with bifurcating a line.

Regarding the iPad: Yes, the new 'base' model iPad (with the 2-year-old tech) does cost less than the inflation-adjusted $499 of the original ipad (in today's dollars, that $499 would be $575—so that is a significant price reduction).

But!...the iPad Pro 11" model—which I would consider to be the 'cutting-edge' equivalent to the 2010-11 iPads, costs essentially 30% more in today's dollars. Comparing a 2013 cellular 9.7 model at $630 (ipad Air in 2013, in today's dollars: $680) to the 11 cellular pro today at $949, and the price has increased by 39% for an equivalent model. Yes, the base model in 2013 was 16GB vs 64GB in 2019, but even if you use the 32GB 2013 model ($730 then), that is still $783 in today's dollars, meaning a 21% increase. Considering how RAM prices have dropped, I think the 16 to 64GB is probably a close comparison.

Oh...and I'm not saying I won't buy one! LOL. I plan to upgrade my iPad Pro (12.9" 2017 model), there's just no rush for me to do so.

 

[furi0usbee]

I’m in the universe in which I have a use for both iCloud and iTunes. Anyway, enough of this off topic nonsense.

Actually I think we should delve a little bit further about devices that need some sort of tethering... J/K we can end it now.

 

[AgentOSX]

A return to the days of a 30% 'Apple Tax' (as opposed to whatever eye-watering number it is at now) is long overdue.

Their corporate profit margin has generally hovered in the 35-40% range for many years now.

That is not the "Apple Tax." Head to head, Macs are about 25-30% more than a near-identical PC. Not having to deal with Windows is still worth it to me. The problem now is that no one cares about processor speed any more, save for the .5% of people who claim to care about VR. People just want to use the dang machine, and that mean software and services that can be counted on. And Macs to last much longer, twice a long as I have found in my IT consulting business.

iPhones and iPads stand alone, but Apple went stupid with the jacked up costs. And there are about 9 people in the entire world who can tell and OLED phone screen from a good LCD screen. It doesn't matter one single bit to the majority of consumers. I have the XS Max and I cannot tell the difference between it and my mom's iPhone 8 Plus screen.

I also have the new 12.9" iPad Pro, and I like the my 2nd Gen one better. The iPad Pro NEEDS about a .25-.33 bigger bezel around it so you can hold it without touching the active screen. The could make the footprint bigger and fill it up with battery. And they could ditch the notch.

The new MacBook Air I really love. I ditched a 5 month old 15" MacBook Pro to switch to it.

Angela Ahrents' marketing wants to make Apple just a luxury product. F that. They can be a premium-but-accessible brand and item.

Apple needs to stop telling people how beautiful their products are when 85% of them are immediately covered up with a case. It is no longer a selling point. Beauty is boring, it doesn't last and doesn't generate loyalty.

AAPL stock will get rocked in the morning, but the stock is already too stupidly low compared to cash and sales volume and EPS anyway. It is oversold and should be picked up by investors looking to hold off 2+ years. There is a market panic and sector issues to begin with, but a revision of a projection by about 6% really isn't a death knell, especially if the defined.

And since "supply constraints" were blamed by Apple... ummm... Time Cook is supposed to be a logistics whiz. He couldn't make enough product or get them from A to B fast enough? He needs to stop whining about the social cause of the day and run the damn company competently. Or better yet, not. Move him to "tech evangelist" (like the Guy Kawasaki of old) and get him out of the CEO position that he never should have had to begin with.

 

[KPOM]

Yes it is required. Especially if you have 300 GB worth of data on the phone like me. Uploading to the cloud can be very slow and not everyone wants to pay for cloud storage ... and I have bandwidth caps in my area for internet. Your point isn’t a point at all. You just have tunnel vision.

You have a unique use case. It is not required to plug in an iPhone to a computer to use it. Apple also can transfer data to another phone through Wi-Fi.

 

[dazz87]

Blame someone else when things are not going right.............

 

[furi0usbee]

I bought a Mac Mini for $1k last quarter so I’ve done my part to prop up the AAPL stock price. Have you done your duty?

I purchased a mini back in March 2018. $699 for a 5400 RPM spinning disk. Same speed as my original 2005 Mac mini LOLZ. First thing I did was put an SSD in there. Apple I guess has no shame using physical disks in 2018/19.

 

[Ds6778]

I loved the Jobs era of iPhones. Simple lineup, easy to understand. I can't imagine the amount of people going to the Apple store and asking what the difference between the two iPhones are, I would hate to be a rep. You have to explain that the XS is the better phone while trying to still sell a XR lol

 

[Spoon!]

You have a unique use case. It is not required to plug in an iPhone to a computer to use it. Apple also can transfer data to another phone through Wi-Fi.

It’s hardly unique.