Kuo: Reports of iPhone 8 Sales Woes 'Overdone' and 'Excessively Negative'

[MacRumors]

Reports of lower than expected first weekend iPhone 8 sales are "overdone," KGI Securities analyst Ming-Chi Kuo told investors in a new note sent out this evening. Kuo says that based on estimates of iPhone 8 production and research data from Localytics, the market is "excessively negative" on iPhone 8 sales.

According to Kuo, first weekend sales of the iPhone 8 were not weak, but stable. He believes Apple is expecting a 50/50 demand split between iPhone X and iPhone 8 and 8 Plus, and sales of the latter two devices are on target when taking that into consideration.

We previously estimated the production weighting of new 2017 iPhone models at roughly 50% iPhone X and 50% iPhone 8/ 8 Plus. This matches what we believe is Apple's (US) estimate for demand. At first glance, the combined first-week adoption rate for the iPhone 8/ 8 Plus might appear low (about half that of iPhone 6s/ 6s Plus and 7/ 7 Plus). However, this is due to the fact that the iPhone X is not included, not because iPhone 8/ 8 Plus first weekend sales have been weak.

Recent data from Localytics found that the iPhone 8 Plus is more popular than the iPhone 8, which Kuo says aligns with KGI's production-side observations. While sales were lower overall, the iPhone 8 Plus saw the strongest first weekend adoption rate of any Plus-sized iPhone to date.

We note that production of the iPhone 8 versus 8 Plus in 3Q17F is roughly split down the middle of a total of 16-18mn units. This reflects Apple's thinking that demand for these two models will be similar, at least in the early stages. In reality, according to Localytics, iPhone 8 Plus sales fared slightly better than those of the iPhone 8 during the first weekend, while the former's shipping time was longer, according to Apple's online store.

Kuo believes the market is negative on first weekend iPhone 8 sales because market analysts rely overmuch on observed sales momentum in unlocked/SIM-free channels such as the Apple Store, while overlooking sales momentum within carrier channels.

iPhone 8 lines outside of Apple retail stores were indeed shorter this year than in past years, says Kuo, but there was stable first weekend demand within carrier channels. Most people who camp outside of Apple Stores to purchase devices are "presumably hardcore Apple fans and heavy users" who are waiting for the iPhone X, which he says explains the perceived lack of demand.

Though Kuo believes first weekend sales of the iPhone 8 and iPhone 8 Plus are on track, he warns that iPhone 8 and 8 Plus shipment momentum may not be stable and needs to be closely monitored as the launch of the iPhone X approaches.

Article Link: Kuo: Reports of iPhone 8 Sales Woes 'Overdone' and 'Excessively Negative'

 

[rafark]

Don't you say.

 

[sundog925]

who really cares except shareholders?

buy the phone you like, when you like.

if we didn't have such over saturation of the phone market we wouldn't be 'woe-ing'.

i mean, god forbid we skip a year for an iphone smh...

 

[vipergts2207]

But muh narrative!

 

[MacFather]

Deleted.

 

[tillsbury]

Well here in NZ the 8 is the first Apple device that hasn’t been freely available in multiple shops from launch day. With a broken phone here we needed one the other day even though the X is on order. I have bought all sorts since the original iPad on launch day, and this is the first time I’ve failed to buy. Ordered online, estimated 2-3 weeks delivery. This certainly doesn’t seem to be a disappointing launch for Apple.

 

[Mr Fusion]

While sales were lower overall, the iPhone 8 Plus saw the strongest first weekend adoption rate of any Plus-sized iPhone...

So it's fair to say there's no fat-shaming going on here?

 

[nutriousmitten]

Kuo's definitely been given his orders from Cupertino, making sure that the wording he uses, for the large platform of investors and general public who he serves, is carefully crafted and spun.

Bottom line, this had to be the worst first weekend of sales for an IPhone launch maybe ever, and while that doesn't mean it or the phone is a failure, that's just facts and no use in dancing around it, but that's what he is doing.

And it's not just the hard cores waiting for the X, it's for a lot of people who want the upgraded features of things like the camera and screen size of the + in the form factor size of the regular IPhone, as one very simple and basic example.

 

[kaz911]

well in the UK (ebay) you can already buy iPhone 8 Plus unlocked new in box with GBP 150-200+ discount. (SRP for 256GB - £949'ish) - some locked versions sold for even down to £630'ish. Multiple BIN for < £800.

 

[Bako-MacAddict]

I’m enjoying the heck out my 8 while I wait for the X! Spoiling myself.

 

[pat500000]

The title needs to edify in regards to "overdone" to "over-COOK-ed."

Message to Jeff WIlliams: Get your nike shoes and start running your factories right.

 

[unobtainium]

Kuo's definitely been given his orders from Cupertino, making sure that the wording he uses, for the large platform of investors and general public who he serves, is carefully crafted and spun.

Bottom line, this had to be the worst first weekend of sales for an IPhone launch maybe ever, and while that doesn't mean it or the phone is a failure, that's just facts and no use in dancing around it, but that's what he is doing.

And it's not just the hard cores waiting for the X, it's for a lot of people who want the upgraded features of things like the camera and screen size of the + in the form factor size of the regular IPhone, as one very simple and basic example.

Sure, Kuo is on Apple's payroll...Just like you're on Samsung's, right?

 

[MagMan1979]

I’m enjoying the heck out my 8 while I wait for the X! Spoiling myself.

Damnit, you’re giving me ideas, I almost pulled the trigger on the 8+ even though I’ll be pre-ordering the X, now my wallet is feeling itchy!!!

 

[lotsalag]

Apple must be extremely happy that they no longer report launch weekend sales numbers. They would be embarrassing for the iPhone 8.

 

[Moccasin]

well in the UK (ebay) you can already buy iPhone 8 Plus unlocked new in box with GBP 150-200+ discount. (SRP for 256GB - £949'ish) - some locked versions sold for even down to £630'ish. Multiple BIN for < £800.

I suspect these are being sold by those who bought the 8/8+ with the intention of then getting the X. Given that it’s still within the 2 week return period, if these users don’t like the 8 they could just go back to Apple.

If anyone bought multiple 8/8+ expecting to make some money, then they only have themselves to blame. They should have just read macrumors to know demand for the 8/8+ would be weaker.

KGI are merely writing what most rational people will have assumed. That demand for the 8/8+ is being affected by the imminent X release. Logically, you can assume that demand for the 8/8+ is 2/3 normal overall demand or less, with the difference greater for those who normally pre-order - these are the early adopters who want the latest & greatest. I wouldn’t have thought it needed saying but guess there’s some tactics going on amongst investors somewhere trying to short the stock before the X is released.

 

[apolloa]

Ok, so this sort of report seems to have been made so the man can justify his job and pay cheque... nothing more.

 

[MagMan1979]

Apple must be extremely happy that they no longer report launch weekend sales numbers. They would be embarrassing for the iPhone 8.

Another hyperbolic, fact-less comment. Gotta love it!

 

[johnnygee]

My unlocked 8 Plus,which I ordered direct from Apple on 9/15, arrived last Saturday, and I'm delighted with the phone. Perhaps these expensive phones have matured beyond the point of being a toy for high school kids and college hackers. My first iPhone was a 4s which I purchased from Best Buy, and I definitely didn't camp out in front of the store to make my purchase. Purchasing a new phone these days is very easy on the web, and setting up the new phone and decommissioning the old phone is all automated. Why would I want to wait in line to buy a new iPhone, especially in light of the fact that there is no Apple store conveniently located nearby?

For something that's a serious business tool, I think that hype surrounding the release of every new iPhone is a bit ridiculous anyway.

 

[PJivan]

The iPhone hype is over. Steve Jobs's magic is gone. Sad times.

Apple is doomed! We are all doomed!! But on a positive note, we complained for the freaks who used to camp outside the Apple Store before, we can complain the lack of them now.....don't you understand? We can always complain for totally meaningless things in life!! Life goes on and Apple is doomed since 2011!!!

 

[mi7chy]

People with the 6S and 7 were on the fence suspecting the 8 is just a rehash of the same thing then YouTube community confirmed they were right.

Same performance

Same camera with same slow autofocus, shaky OIS/EIS, overly yellow skin tone, over-saturated sky, mediocre low light, mono sound, etc.

 

[iTom17]

I did notice that when I bought my iPhone at the local 'MediaMarkt' here and they've had ton of those available. When I asked whether they had my specific device there the seller told me they've had plenty. I asked him if the iPhone 8 and 8 Plus were in popular demand. He insisted on saying 'yes', but later mentioned that so far they sold fewer than in previous years.

Of course that's just one retailer. And one location. But I wouldn't be surprised if Kuo is right. The iPhone 8 and 8 Plus are definitely good phones, but the upgrade rate is simply gonna be less compared to previous years. There's not much of a difference between iPhone 7 and 8. Heck, I bought an iPhone 8 Plus to actually justify an upgrade from the regular 7.

Anyway, I'm sure that Apple's is gonna put the sales of these devices in a way that it doesn't sound negative or worrying at all. After all, they still have the iPhone X as their 'secret weapon'. Look forward to the sales of those phones combined.

 

[pat500000]

Kuo's definitely been given his orders from Cupertino, making sure that the wording he uses, for the large platform of investors and general public who he serves, is carefully crafted and spun.

Bottom line, this had to be the worst first weekend of sales for an IPhone launch maybe ever, and while that doesn't mean it or the phone is a failure, that's just facts and no use in dancing around it, but that's what he is doing.

And it's not just the hard cores waiting for the X, it's for a lot of people who want the upgraded features of things like the camera and screen size of the + in the form factor size of the regular IPhone, as one very simple and basic example.

What makes you think he was given the order to word it "appropriately?"

 

[44267547]

The iPhone hype is over. Steve Jobs's magic is gone. Sad times.

I think what's sad is when Steve Jobs's name is resurrected every time an iPhone article surfaces, which is not always appropriate. And as far as your iPhone hype comment, I would wait until November 3 gets here, and there will be plenty of hype at that time for the iPhone X, guaranteed.

 

[Applebot1]

Bottom line is if you can afford an X why bother with an eight The X is the way forward from now on. Many ways this is a translational year into the new model.

 

[jschaeff]

I walked into my local T-Mobile store thirty minutes after they opened on launch day expecting to walk out with two 8+ models. I had figured I would be successful because of reports of higher availability because most people were waiting for the iPhone X. Imagine my surprise when I was informed that they had already sold their stock and was offered iPhone 8 models instead. The clerk told me they had plenty of those models on hand. I ordered the 8+ models and received them on Monday. I guess it all depends where you were on release day as far as availability goes. I agree with the article that Apple sales are in line with their expectations.