iPhone X Iphone Quarter Question

[Fthree]

Was just reading news on how apple sold 70+ Million iPhones last quarter (2 to me/wife). Thats amazing and I do love my X and she the 8+. I bought mine outright and hers is on the IUP. I was sitting here wondering about how the "iPhones sold" is actually being measured. My wife will probably turn hers in september to upgrade and ill more than likely keep mine. As i said above my iPhone was purchased outright so they received the entire amount for it. Are they counting the IUP phones as phones fully sold in the number (im assuming they are) and at what point is there a loss (the other half of the price) associated with the trade back in of the phone? My best guess would be is they are selling the creditors the phones at a cheaper price or something but then that would make the $999 less and I am pretty certain that alot of the new purchasers are on IUP. I guess I need something else to do on a saturday night than ponder questions to place on Macrumors lol

 

[Vermifuge]

77.3 million, not billion. 1% below last year (stagnant growth even when accounting for the extra week of sales in the quarter a year ago) and short of expectations of an 80 million+ "super cycle" quarter.

I imagine the iUP phones that are turned it get refurbished and are either sold as is or used when performing a warranty exchange / repair.

 

[Fthree]

77.3 million, not billion. 1% below last year (stagnant growth even when accounting for the extra week of sales in the quarter a year ago) and short of expectations of an 80 million+ "super cycle" quarter.

i imagine the iUP phones that are turned it get refurbished and are either sold as it or used when performing a warranty exchange / repair.

Thanks I edited the post!
[doublepost=1517709347][/doublepost]

77.3 million, not billion. 1% below last year (stagnant growth even when accounting for the extra week of sales in the quarter a year ago) and short of expectations of an 80 million+ "super cycle" quarter.

i imagine the iUP phones that are turned it get refurbished and are either sold as it or used when performing a warranty exchange / repair.

Do you think that the slowing of the older phones had something to do with the amount of sales and now that that has been pointed out and “fixed” these phones will “last and function correctly for a longer period” thus making people upgrade less frequently? I can say that one of the reasons I was a frequent upgrader was because it seemed as if my phones were slowing down. Good to know that they actually were.

 

[Vermifuge]

Thanks I edited the post!
[doublepost=1517709347][/doublepost]
Do you think that the slowing of the older phones had something to do with the amount of sales and now that that has been pointed out and “fixed” these phones will “last and function correctly for a longer period” thus making people upgrade less frequently? I can say that one of the reasons I was a frequent upgrader was because it seemed as if my phones were slowing down. Good to know that they actually were.

The only phones Apple have confirmed to slow down are 6/6s (and plus) models. Thought the battery replacement extends to all modern iPhones.

I'm not an analyst but i'm sure there were a number of factors:

• Some people think the battery program will prevent people from upgrading
• Some people think others skipped the X because they don't buy G1 hardware.

I think the reason is most people find their phones... "good enough" right now a new iPhone remains useful for a long time and new models don't being a lot of differences.Even in the world of android the gap between low cost phones and flagship models is narrowing each year.

 

[Fthree]

Its funny, in the past i have been the type that HAS to upgrade to the latest and greatest from apple (phone, MacBook, iPad) This year I was tempted by the new MacBook and iPad 10.5 but refrained because my iPad air and 2015 MacBook pro are still amazing. I DID get the iPhone X because it is to me that amazing but if theres no type of "tethergate" with the iPhones and they keep the same design as they did for past phones ill be hard pressed to upgrade the phone for a while as well.

Apple makes their products TOO great there is something to be said about that but its not good for business in the long run.

Disclaimer---- I am NOT saying apple is doomed lol just saying i can see a slowdown in the hardware they will sell

 

[KrisLord]

Was just reading news on how apple sold 70+ Million iPhones last quarter (2 to me/wife). Thats amazing and I do love my X and she the 8+. I bought mine outright and hers is on the IUP. I was sitting here wondering about how the "iPhones sold" is actually being measured. My wife will probably turn hers in september to upgrade and ill more than likely keep mine. As i said above my iPhone was purchased outright so they received the entire amount for it. Are they counting the IUP phones as phones fully sold in the number (im assuming they are) and at what point is there a loss (the other half of the price) associated with the trade back in of the phone? My best guess would be is they are selling the creditors the phones at a cheaper price or something but then that would make the $999 less and I am pretty certain that alot of the new purchasers are on IUP. I guess I need something else to do on a saturday night than ponder questions to place on Macrumors lol

Revenue and volume are 2 separate measures and they’ll be handled differently. Reported revenue was for all products, not just iPhone.

Under the IUP the phone is sold to you, not the creditor and you own it. You also owe the loan company for the cost.

Apple can recognise this as a unit sale and book the $999 revenue which they receive from the loan company. (The loan company may take a fee from this or be paid separately) but this is likely a cost of sale rather than a reduction in revenue.

Remember under the IUP the loan has no interest on it, so Apple need to pay the loan company otherwise the loan company would be losing money (lending 999 and getting it back over 2 years)

 

[Fthree]

Revenue and volume are 2 separate measures and they’ll be handled differently. Reported revenue was for all products, not just iPhone.

Under the IUP the phone is sold to you, not the creditor and you own it. You also owe the loan company for the cost.

Apple can recognise this as a unit sale and book the $999 revenue which they receive from the loan company. (The loan company may take a fee from this or be paid separately) but this is likely a cost of sale rather than a reduction in revenue.

Remember under the IUP the loan has no interest on it, so Apple need to pay the loan company otherwise the loan company would be losing money (lending 999 and getting it back over 2 years)

thanks for the clarity. Just seems odd that the loan companies would lend year after year with a "new" full 2 year loan when the phone is only used for one year and gets flipped.

 

[jav6454]

77.3 million, not billion. 1% below last year (stagnant growth even when accounting for the extra week of sales in the quarter a year ago) and short of expectations of an 80 million+ "super cycle" quarter.

I imagine the iUP phones that are turned it get refurbished and are either sold as is or used when performing a warranty exchange / repair.

I would attribute it to 1 less week in the quarter and slow down year. Also, I wouldn't be surprised if we are starting to see iPhone saturation going on from this quarter forward.

 

[KrisLord]

thanks for the clarity. Just seems odd that the loan companies would lend year after year with a "new" full 2 year loan when the phone is only used for one year and gets flipped.

After making 11 of 20 payments (in the UK, think it’s 24 months in US) plus the deposit, you’ve paid more than 1/2 the cost (plus AppleCare probably makes a bit of cash too)

Based on mobile recycling places, the phone is worth more than the debt at this point by quite a bit, So Apple take your phone and pay off the loan. Then the process starts again.

I suspect the phones are given new cases and put into the refurb store for only a fraction below retail cost.

Probably worth explaining the “extra week” in apples financials too.

Accounting periods are often broken down into periods other than straight calendar months.

A common one is a 4 week period, a 4 week period and then a 5 week period. It makes every quarter in the year an identical length, and can stop month ends falling at weekends.

Apple use this method, but the downside is it missed the fact that it gives 52 weeks to a year and not 52 weeks and 1 day. So every 5-6 years an extra week is added. It’s like a leap week for accounting periods.

Apple had his extra week in their December quarter last year, but not his December. So we’re comparing a period with 14 weeks with one with 13. Using this logic, they sold more per week this quarter than a year ago.