Foxconn Reports First Ever Profit Decline on Back of Slow iPhone Sales in 2016

[AxiomaticRubric]

I was thinking on an even more basic level. Logic dictates that at some point foxconn will hit a peak too regardless of what they make. Every comapny does. With everything.

Yes. Eventually all industries run out of humans.

 

[Juicy Box]

A lack of "compelling" features for the iPhone 7 was said to be the main reason why many Galaxy Note7 owners decided to stay in the Samsung family when those devices began malfunctioning. After the events of the Samsung Galaxy Note7 crisis began subsiding, analysts criticized Apple for failing to capture new customers into its ecosystem from the churning Note7 user base.

While I agree that the iPhone 7 lacked compelling features, I think that had little to do with the lack of switchers from the Note 7 to the iPhone 7.

There are many other Android phones to switch to.

 

[smacrumon]

That's what happens when you release the same device 3 years in a row. Of course the internals/cameras are much improved with each generation, but the average consumer judges by how it looks. The fact that the device wasn't redesigned, and still has those huge bezels is ridiculous. I love my iPhone for the software, but the hardware is now dated and needs to change.

For some customers the exterior is 95+% of the purchase decision. And rightly so, there are some terrible options out there. With 6/6s/7 protruding cameras and antenna bands are enough to turn customers off or put them on an indefinite holding pattern until something, anything, surfaces with true beauty.

 

[Paul Dawkins]

The price reached a psychological wall for many customers a number of years ago in my opinion. The price must be dropped $200 next new release.

Indeed. I have 7 Plus and I'll be using it for at least a few years if nothing happens to it.

 

[TonyC28]

Saturated smartphone market seems to be the big thing here. Everyone has one now so these companies don't just need us to buy one, they need us to replace the one we already have. Up until a few years ago I was able to buy the newest iPhone every year at the cheapest price through AT&T thanks to subsidized pricing. We don't have that anymore. So now not only do they need to give me a reason to replace the iPhone/smartphone that I already have but they need to convince me to do it at full retail price.

 

[ryanwarsaw]

Only $136 billion in revenue? I hope the executives at Foxconn will be able to put dinner on the table for their families.

 

[nwcs]

I agree, but I don't think it's just iPhone. Smart phones all around have hit a peak. There really hasn't been anything ground shaking in some time now.

No, and to maintain profit margin they are pushing consumers upscale. It's a very common tactic, tried and true. The problem is you can generally only get away with it once before consumers go elsewhere. A radical idea would be to do an updated iPhone SE with a new look. Apple re-inventing the smaller phones would do a lot of good instead of pushing people to more gargantuan phones.

 

[falainber]

Have we finally hit peak iPhone? Maybe Apple will give some attention to the Mac now?

Nah, we hear that it's all about AR now.

 

[jonnysods]

Everything hits a peak. Everything.

Market saturation, it has to be happen at some point to something so consistently popular for 10 years!

 

[akbarali.ch]

profit decline is not equal to loss. they are making it appear as loss. they are still making boat load of money, just not as much as earlier.

 

[Return Zero]

Have we finally hit peak iPhone? Maybe Apple will give some attention to the Mac now?

Unfortunately, if we're already passing the peak iPhone, then we are well beyond peak Mac. I'm afraid the long product cycles and "overdue" updates will sadly now be the norm for Macs. They will slowly become more and more of a niche market as mobile devices gain ever more productivity.

 

[falainber]

Aren't these guys also spending butt loads of money on automation?

They are but that would affect only the profits. Their revenues also declined.

 

[ryanwarsaw]

The price reached a psychological wall for many customers a number of years ago in my opinion. The price must be dropped $200 next new release.

This could be true. I know I have a problem justifying the cost these days. I guess this began to happen for me when they released the plus models and suddenly my iPhone habit became more costly than before.

 

[dirtylilhobo]

Inovation is great but taking away is not. Removal of the headphone jack to make the iPhone a tiny bit thinner was a detriment. Not only to invest in more hardware but an additional burden of keeping the ear pods charged and bluetooth isn't all that great. I'd rather have the slightly bulkier iPhone with hardwire connectivity to a decent set of headphones or ear buds than not.

 

[linuxcooldude]

Dont see a surprise. Apple is not hungry anymore, If they don't come hard this year its over. look at amazon and google. The Alexa is killing Siri.

Yeah, because Google pixel and Amazon Fire phone are so awesome.

 

[imran5720]

Time to clone Steve Jobs

 

[freepomme]

I said this would happen. This is exactly what I told yall would happen. I told you so. And it's all because of that headphone jack.

 

[bigjnyc]

The price reached a psychological wall for many customers a number of years ago in my opinion. The price must be dropped $200 next new release.

That will never happen, if anything the price will go up and they'll use the OLED screen to justify it.

 

[DevNull0]

Foxconn needs to have the courage to accept slow sales for the sake of driving us towards a wireless future. Or something like that.
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I said this would happen. This is exactly what I told yall would happen. I told you so. And it's all because of that headphone jack.

The missing headphone jack is a big downside and there is no real advantage to the iPhone 7. The 6s is just a plain better phone. It does pretty much everything the iPhone 7 does (less water resistance) and gives you a headphone jack.
[doublepost=1484069769][/doublepost]

That will never happen, if anything the price will go up and they'll use the OLED screen to justify it.

As new tech comes on the market, other companies incorporate it into their hardware as a natural evolution, it doesn't cost more it's just the next step. Apple pretends it's some sort of miracle they are single handedly responsible for and they're going to charge big bucks for it. Meanwhile all those big bucks get heaped onto their margins.

It's not a sustainable model. If an iPhone 4 is worth $500 then certainly an iPhone 6 is worth $600, I mean it's a newer better phone, right?

 

[BeSweeet]

Hopefully Foxconn doesn't pay their underpaid employees even less...

 

[recklesslife85]

New iPhones aren't the problem. It's iOS, it's looked and functions the same for 10 years. A bit of paint in 7 wasn't enough. People are bored of the same old thing. That's what my friends told me, so I'm guessing it's true. I have the same feelings but I use iOS and Android so it's not a huge issue for me. Shake iOS up Apple, stop playing the safe game.

 

[JGRE]

They should start producing Imoticons, that what everybody is looking for not great hardware /s

 

[iRalph]

Only reason I upgrade to the 7 plus was because my 6 plus became unbearably slow after upgrading to iOS 10

 

[ksnell]

More colors. They obviously need more phone colors.

Consider adding "/s" to this or maybe people at Apple will see and think you are actually serious!

 

[LordVic]

This could be true. I know I have a problem justifying the cost these days. I guess this began to happen for me when they released the plus models and suddenly my iPhone habit became more costly than before.

its made even worse internationally, where Apple is artificially inflating the price in foreign markets so that their US Books still record the larger profit margins.

Canadian iPhones are ridiculously priced to the point that it's next to impossible to justify purchasing one off contract. we Saw Apple's prices across the board go up 30% last year overnight, all for accounting balance sheet purposes.

the 32GB iPhone7 (4.7") pre-tax price is now $899. With tax it's $1,015

this right here is a monstrous barrier to entry.

Anecdote time:
it's very interesting to see, that 3-5 years ago, iPhones were everywhere. Especially around the office. Now, a few people here and there have them, but the majority of people I know, see, and work with have moved to Android. They cannot justify $1,000 for a phone