Decline in iPhone Shipments Could Make Apple Worst-Performing Top Five Smartphone Brand of 2016

[Bubba Satori]

"The first messenger, that gave notice of Lucullus' coming was so far from pleasing Tigranes
that he had his head cut off for his pains; and no man dared to bring further information.
Without any intelligence at all, Tigranes sat while war was already blazing around him,
giving ear only to those who flattered him. - Plutarch's Lives

 

[NOV]

Apple needs to drop the price if they want to keep sales up. 650 USD for a 16GB base model is ridiculous.

If I look around me here (Netherlands) and see who are carrying the latest and greatest iPhone models the price seems to be the least of issues. The only danger for Apple is when they loose their "cult edge" over Android and I do not see that change too soon.

 

[KPOM]

Why is this a story? Three months ago, Apple said their revenues will be $50B to $53B. That's what it will be. I'm sure all analysts are idiots who can't seem to hold on to facts from companies like Apple, who accurately predict their sales and financials.

What will Apple do in the future, wait until Apple tells us next Tuesday!

Kuo definitely timed the report in advance of Tuesday's earnings release. Apple will give guidance for the June quarter, and depending on how much the stock goes down tomorrow as a result of Kuo's report, it will respond accordingly to what are likely to be more muted expectations for the revenue guidance.

That said, the worst reaction Apple can take would be what a lot of people here are recommending (i.e. slashing the price of the iPhone and getting into a spec war with Android OEMs). 2017 is the 10th anniversary of the iPhone and the perfect opportunity for a summer release of a redesign if that's when they will be ready for one. 2013 was a "bad year" for Apple, but then the iPhone 6 came out in 2014 and they were riding high again.

 

[I7guy]

In what way is it a "great accessory"? You even admit that it doesn't actually do anything. I've always thought it was such a silly product. Might as well release the Apple Toaster or the Apple Mattress or the Apple Toothbrush.

The bottom line is that there is absolutely no reason for that stupid watch to exist. It doesn't serve any need in the marketplace. It's just a gadget meant to suck money from people who are brand loyal.

That is not what I said as you paraphrased me. Also you might want to write the Apple board and tell them: "there is absolutely no reason for thAt stupid watch to exist".

Threads like this bring out the arm-chair ceo in all of us.

 

[kdarling]

Do you think Apple is going to "break-out " the SE sales numbers?

Unless it's an incredible number, they won't.

Instead, they'll probably do their usual smoke and mirrors thing, where they compare it to something else that is confusing, because they count on people being ignorant or lazy.

Like back when Cook said that the Apple Watch's sell through was higher than the iPad's in its first few weeks:

Immediately all the bloggers on the planet looked up iPad sales for those weeks and came up with 3.1 million. But he didn't say "sales", which includes stock on retailer shelves or being shipped to retailers. He very cleverly said "sell through", which is always lower, often by quite a bit. And no one noticed this verbal slight of hand.

Moreover, if he meant percentage wise, then of course the Watch did better, as it had 100% sell through versus whatever iPads did. (That's because the Watch was at first only available online or in Apple stores, and Apple store inventory doesn't count against sell through like regular retailer inventory).

Tim Cook is a pro at misdirection. It's a technique he learned well from Steve Jobs.

 

[I7guy]

I don't see this as bad news for Apple users. If anything, Apple will have to work harder to improve hardware, software and services. Competition is good for everyone. Declining sales will be more than an adequate incentive to do better

I don't see any radical change; this has already been factored into account.

 

[musha68k]

"Peak iPhone" maybe but I think it might be more due to Apple having lost the functional high ground - it took a while but that might very well be a significant contributing factor for lower sales ("What's the difference? Aha it looks nicer but is essentially the same?").

Sad!

 

[I7guy]

Before you knock what he says look at his actual track record. He's correct more than 87% of the time. Ignoring him is ignoring the only analyst who's consistently accurate.

Wifes pregnancy test is also 87% accurate.

 

[KPOM]

Mac sales are still a minor piece of Apple, if they rise, it doesn't do Apple much good if iPhone drop.

Plus the current mac lineup is basically iPhone accessories. They're chromebooks, not serious machines. Apple computer users are still fleeing Apple.

Apple's stock is definitely driven by the iPhone, but Mac has reclaimed its spot as the second largest source of Apple's revenue. They are not "chromebooks." Stop with the hyperbole. However, the iPhone market is a good place for Apple to look for other sources of revenue. That's where Mac, iPad, and services fit in. "Revolutions" don't happen ever year (otherwise they would not really be "revolutionary.") The whole category of smartphones has matured, and what we are seeing is a timing issue with Apple (iPhone 6 brought forward a lot of upgrades because of the larger size), while #3-5 primarily represent new faces taking share from the older Android players such as Lenovo. Samsung corrected its 2015 missteps, and arguably, had it released something like the S7 last year, they'd be in a similar position as Apple this year (having a tough comparison because 2015 would have looked much better).

 

[pat500000]

Hey apple, And you were saying about iPhone 7 plus pro?

If iPhone 7 plus pro comes out, that will be for those professional iPhone user. Not for faint hearted consumers.

 

[KPOM]

Unless it's an incredible number, they won't.

Instead, they'll probably do their usual smoke and mirrors thing, where they compare it to something else that is confusing, because they count on people being ignorant or lazy.

Seeing as Apple has never released sales figures for a specific iPhone model ever since there have been more than 1 to purchase, I don't expect they will start with the iPhone SE, which obviously isn't intended as a flagship, anyway.

As for smoke and mirrors, their competitors don't release any unit sales data for their products.

 

[Zellio]

This is kinda what happens when your CEO is Steve Ballmer the 2nd and you are entirely run by greed, to the point where you keep trying to have higher profit margins while your competition has made your product look less and less viable over the years

 

[I7guy]

This is kinda what happens when your CEO is Steve Ballmer the 2nd and you are entirely run by greed, to the point where you keep trying to have higher profit margins while your competition has made your product look less and less viable over the years

Is that why Apple had record breaking quarter after record breaking quarter?

 

[cmwade77]

And that's what happens when you have the most expensive smartphone and stop innovating. Really, there are some pretty innovative phones coming out right now by comparison to the iPhone and they are almost all cheaper.

 

[Kobayagi]

Apple is stagnant, resting on its laurels and simply way too slow in product development in a globally competitive world. When was the last time they released a product, especially an iPhone, where people when "wow!"? They are becoming 1990's Microsoft - trying to do too many things in too many segments. Apple Car - really?

It still produces great products, but their competitive advantage is shrinking fast. Tim Cook - Apple need to step up its game and focus on creating a few great products, not a smorgesborg of decent products.

They're focussing too much on iOS, since that sells better. They have forgotten where they came from, the pc market. They are abandoning the pro market and thats evident by not so great (and late) updates to the pro laptops, new, crappy laptops which serve no other purpose than Facebook and email (MacBook) and no development on new pro software like Aperture.

 

[sputnikv]

no surprise. the iphone lacks an oled display, does not support inductive wireless charging, is not waterproof, siri does not function well and neither does apple music

 

[TurboPGT!]

If Apple is under the impression that they can release a minorly updated 6S in late 2016 and make it a huge seller, they're sadly mistaken.

The real problem is, they could make a totally brand new physical case with the exact same internals as the 6s and you'd celebrate it

Or they can make a phone capable of all new levels of performance on every front, but it looks vaguely similar to the 6s, and people like you would call it "minorly updated".

Sad, sad, sad, sad.

 

[navaira]

If I look around me here (Netherlands) and see who are carrying the latest and greatest iPhone models the price seems to be the least of issues. The only danger for Apple is when they loose their "cult edge" over Android and I do not see that change too soon.

Well – I live in Amsterdam and if I were to extrapolate what I see I'd say that Huawei is the most popular smartphone brand, followed by Samsung. Somehow when I see people with iPhones they always seem to be pre-6 model. But then if I do a poll in my household, Sony has 100% of smartphone market

I think the time has come when Apple's greed-based decisions are going to bite them in the bum. This is what happened to "beleaguered Samsung" (as MacDailyNews always calls it). Which is not to say that they will become "the worst performing brand" – what a ridiculous title. Even Adele's album dropped off number one at some point which didn't make her "the worst performing top five artist". But I think Apple have spent the last few years repositioning themselves as a luxury brand. Who cares if they sell less phones than last year when they still have 90-95% of the profits of the entire market? We here feel personal about Apple because we grew with "Think different". Well, if we want to continue thinking different, we better all get CEO jobs.

 

[TurboPGT!]

In what way is it a "great accessory"? You even admit that it doesn't actually do anything. I've always thought it was such a silly product. Might as well release the Apple Toaster or the Apple Mattress or the Apple Toothbrush.

The bottom line is that there is absolutely no reason for that stupid watch to exist. It doesn't serve any need in the marketplace. It's just a gadget meant to suck money from people who are brand loyal.

What an interesting post. /s

 

[IJ Reilly]

Kuo definitely timed the report in advance of Tuesday's earnings release. Apple will give guidance for the June quarter, and depending on how much the stock goes down tomorrow as a result of Kuo's report, it will respond accordingly to what are likely to be more muted expectations for the revenue guidance.

That said, the worst reaction Apple can take would be what a lot of people here are recommending (i.e. slashing the price of the iPhone and getting into a spec war with Android OEMs). 2017 is the 10th anniversary of the iPhone and the perfect opportunity for a summer release of a redesign if that's when they will be ready for one. 2013 was a "bad year" for Apple, but then the iPhone 6 came out in 2014 and they were riding high again.

All the analysts "time" their reports ahead of earnings reports. This is SOP, not a conspiracy. The fact is, AAPL has been driven down for the last six months over these very concerns, so how much lower it will go on Kuo's report will depend on how much of this forecast is already priced in.

 

[MikeyMike01]

The mental gymnastics it takes to come up with a ridiculous title like "worst performing top-5 smartphone brand" is astounding.

What's wrong with responsible reporting, like "Apple shipments down 18%, according to..."

 

[developer13245]

In the used car market, that's referred to as a " paint job overhaul "

Absolutely brilliant and hilarious analogy that captures exactly where Apple is on so many of their "efforts" - e.g New watch bands for everyone! One other specific example related to my comment is Apple's "Developer Success" web pages added to their developer portal - also just a "paint job" on a broken down used car that is the App Store (probably not even a whole paint job, but just tacky pin striping)...

Thanks! I really appreciate analogies - you've contributed to my top ten I'll be sure to credit "RedOrchestra" where I use it!

 

[Danilo - Italy]

Apple needs to drop the price if they want to keep sales up. 650 USD for a 16GB base model is ridiculous.

A 16GB model is ridiculous at any price.

 

[EightyTwenty]

No reason for the watch to exist when wearable tech is growing faster than any other sector in the industry. Nevermind that the watch has a ton of competition that it's also outselling. You really have your head buried deep, deep into your imaginary world.

So... you don't see a actual reason for it to exist either then, eh?

 

[Stella]

That was Google backtracking after all the bad PR and the fact that the price was too high for normal consumer adoption. They did the same thing with the Nexus brand. Don't misinterpret spin as openness.

AFAIR, it was always a beta product fully disclose as one when being sold, therefore couldn't have been spin after the project was canned.

No different than developer visions of other products, such as developer versions of Oculus. Only difference, Oculus became a commercial product.