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Ming-Chi Kuo Says iPhone XR Demand Has Been Lower Than Expected, Slashes Shipment Estimates
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I got a AT&T Moto z2 Force flagship phone just last week for $100 directly from Motorola. 835 cpu and OLED screen. I didn't even need it since I got a Note 9 but I guess I can keep it as a backup. Phones just aren't worth paying high prices anymore since they are just commodities now.
In what world is a used iPhone 7 worth $300? They aren't even going for that much on the direct-to-consumer market like eBay or Swappa. They are inflating the value of the trade-in to above market value to subsidize the new phone. A subsidy is also known as a discount.
Yea, exactly. Because we all know they won't ever budge on margins. Whether you love or hate Apple for doing that, it's that very business strategy that has propelled Apple to the top and have kept them there.
However, if they can shrink the device, lower the cost, retain margins, I think it would be a win win for both customers and Apple.
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7 Page in and no one is keeping up with numbers.
An estimated 205 -210M Shipment in 2018 means they are only estimating 65-70M Unit in Q4 2018. That is way lower than estimate. Assuming the same ASP as last year $793, as the Max and 8 price difference cancels out and without iPhone SE, Apple will need to grow all of its other segment by 20% to meet the guidance.
And a 42M in Q1 is very low by Apple standards in recent years. They did 44M in 2014, and 38M in 2013.
According to Mixpanel, iPhone XS as of 15 Dec has 5.2% adoption rate, and Xr has 1.74%. Compare this to last year iPhone X has 5.11% and iPhone 8 has 6.5% Adoption. Yes the base number may be different, by that is at most 20%. 1.74 and 6.5 is 370% difference !
iPhone 8 saw 0.8% increase since Price Cut.
Combined that is 7.7% this year, and 11.6% last year, adjusted to 8.9% to 11.6% adoption on 15% difference in base. Even by lowest estimate Apple is still shorting nearly 20M iPhones compared to same time last year.
And if you believe these Data are any sign of indication in big picture, may be that is why apple is doing trade in discounts.
I can't wait to see the real results!
An estimated 205 -210M Shipment in 2018 means they are only estimating 65-70M Unit in Q4 2018. That is way lower than estimate. Assuming the same ASP as last year $793, as the Max and 8 price difference cancels out and without iPhone SE, Apple will need to grow all of its other segment by 20% to meet the guidance.
And a 42M in Q1 is very low by Apple standards in recent years. They did 44M in 2014, and 38M in 2013.
According to Mixpanel, iPhone XS as of 15 Dec has 5.2% adoption rate, and Xr has 1.74%. Compare this to last year iPhone X has 5.11% and iPhone 8 has 6.5% Adoption. Yes the base number may be different, by that is at most 20%. 1.74 and 6.5 is 370% difference !
iPhone 8 saw 0.8% increase since Price Cut.
Combined that is 7.7% this year, and 11.6% last year, adjusted to 8.9% to 11.6% adoption on 15% difference in base. Even by lowest estimate Apple is still shorting nearly 20M iPhones compared to same time last year.
And if you believe these Data are any sign of indication in big picture, may be that is why apple is doing trade in discounts.
I can't wait to see the real results!
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Any other company in the world would wish they would ship that number. But sure, panic.
Owning an iPhone XR, it is not a budget phone. It resembles the XS in so many ways the XS only feels unique on paper but not in the real world. Both of the prices should come down.
However I’ve seen some posts suggesting a starting price of $449 and that’s really improbable.
It’s not just cost of parts. Putting more hours into design and engineering simply costs more than someone who recycles software someone else uses (many Android manufacturers) and then just hopes for the best. Software is expensive when you design it and support it for multiple years. Hardware expensive when you design your own chips instead of just sourcing parts. Design is expensive when you’re not creating bandaid solutions.
However I’ve seen some posts suggesting a starting price of $449 and that’s really improbable.
It’s not just cost of parts. Putting more hours into design and engineering simply costs more than someone who recycles software someone else uses (many Android manufacturers) and then just hopes for the best. Software is expensive when you design it and support it for multiple years. Hardware expensive when you design your own chips instead of just sourcing parts. Design is expensive when you’re not creating bandaid solutions.
Hmmm, not everyone looks at a phone screen all day. Probably alot more people look at a computer monitor much more of the day for work. In that case, they are looking at a LCD screen most of the day. In my employment, I look at 10 of them for a 12 hour shift running a power plant.
I own an Xr, actually prefer its screen over the XS max that I returned. The color shift on the angles of the Max were annoying and I did experience some eye strain.
1st Iphone I"ve ever had break.
iPhone XR demand has been lower than expected, according to Apple analyst Ming-Chi Kuo, who has slashed his overall iPhone shipment forecast by 20 percent for the first quarter of 2019. He now expects Apple to move 38-42 million iPhones in the quarter, down from his original estimate of 47-52 million.
Kuo, in a research note with TF International Securities, obtained by MacRumors:Apple reported sales of 52.2 million iPhones in the first quarter of 2018, which corresponds with the second quarter of Apple's fiscal year, so as few as 38 million units in the first quarter of 2019 would be a significant year-over-year decline.
For the iPhone XR in particular, Kuo has revised his shipment estimate to 15-20 million for the first quarter, down from 20-25 million.
Kuo estimates annual iPhone shipments will fall between 205 million and 210 million in 2018, and based on that, forecasts that annual iPhone shipments in 2019 will decline up to 10 percent to a range of 188 million to 194 million. This would fall below Wall Street's consensus estimate of around 212 million units in 2019.
While this news paints a pessimistic outlook for the iPhone, declining unit sales will likely be at least partially offset by the rising average selling price of iPhones. Apple's latest iPhone lineup is its most expensive yet, with the $349 iPhone SE discontinued and the iPhone XS Max topping out at $1,449 with 512GB of storage.
Kuo:Apple will no longer be disclosing unit sales in its quarterly earnings reports going forward, so investors will have to look towards iPhone revenue to determine how well the handset is selling. If unit sales are particularly bad, then a rising average selling price might not be enough to hide the weakness.
Apple has been aggressively marketing its latest iPhones. On its website, for example, the iPhone XR and iPhone XS take up the entire homepage with advertised starting prices of $449 and $699 respectively. However, each have an asterisk that leads to fine print that says pricing is based on an iPhone 7 Plus trade-in.
Apple's earnings results for the first quarter of 2019 will likely be released in May, so we're still some time away from real numbers.
Article Link: Ming-Chi Kuo Says iPhone XR Demand Has Been Lower Than Expected, Slashes Shipment Estimates
"Apple's earnings results for the first quarter of 2019 will likely be released in May, so we're still some time away from real numbers."
Apple will release future quarterly estimates when it does its 12/31/2018 earnings call in February. Those are generally accurate and will give investors a good idea where Apple thinks it will be. True, you won't have specific product line numbers in the estimate, but you can get reasonably close by looking at growth history in Services, iPad, and Mac and then backing into iPhone numbers.
Apple will release future quarterly estimates when it does its 12/31/2018 earnings call in February. Those are generally accurate and will give investors a good idea where Apple thinks it will be. True, you won't have specific product line numbers in the estimate, but you can get reasonably close by looking at growth history in Services, iPad, and Mac and then backing into iPhone numbers.
It does look so and that's why iPhone sales are tanking.
Apple has doubled their trade in values so that if you, for example, trade in an iPhone 7 Plus, you get a trade in if $300. The base model xr then costs $449.
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No, iPhone sales are tanking is fake news. Foxconn reported record revenues in October. No different than last years “x is a disaster” fake news and we know how that turned out.
No, iPhone sales are tanking is fake news. Foxconn reported record revenues in October. No different than last years “x is a disaster” fake news and we know how that turned out.
Foxconn manufactures products for many companies, not just Apple. That's what Wikipedia says:
Foxconn manufactures electronic products for major American, Canadian, Chinese, Finnish and Japanese companies. Notable products manufactured by Foxconn include the BlackBerry,[8] iPad,[9] iPhone, iPod,[10] Kindle,[11] Nintendo 3DS, Nokia devices, Xiaomi devices, PlayStation 3, PlayStation 4, Wii U, Xbox 360, Xbox One[12], and the TR4 CPUsocket on some motherboards. As of 2012, Foxconn factories manufactured an estimated 40% of all consumer electronics sold worldwide.
Their profits may or may not reflect Apple fortunes.
Ok so.....if Apple says the XR is their best seller daily since launch and if this report is accurate....that means the XS demand is EVEN WORSE than the XR. So where are those headlines? Or is this all a bunch of BS as usual. Apple has little to zero reason to lie about the XR being their top seller.
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The XS/XR are for people who have 2, 3, 4, 5 year old phones. Not for folks who have an 8 or an X. So get over it people. Phones are utilities now, they're like cars. There isn't going to be a revolutionary new phone every year like 10 years ago when the market was brand spankin' new.
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Maybe because its just total BS?
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I think its time for people to relax and enjoy the phones they have instead of complaining that whatever is new this year isnt worth it, etc etc etc , blah blah blah. For a few years now people have very little need/want to upgrade every year.
The XS/XR are for people who have 2, 3, 4, 5 year old phones. Not for folks who have an 8 or an X. So get over it people. Phones are utilities now, they're like cars. There isn't going to be a revolutionary new phone every year like 10 years ago when the market was brand spankin' new.
Which is why this is apple sales slump is fake news. But that’s my opinion, you can believe differently. The truth will come out.
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Why would anyone drive a Hyundai Elantra when they could drive an m5 is a good question in the same vein. The Elantra is redundant.
I don't understand why the Xr is considered too expensive. Last year, Apple sold the iPhone 8 plus for $799 at launch. The Xr seems to be a better deal for $749 at launch.....bigger screen in a smaller footprint, Face ID, A12 Bionic, more color options.....etc.
Maybe it is because people are comparing the Xr to prior Apple "economy" devices, like the iPhone 5c. But in terms of product positioning, I don't think Apple ever expected the Xr to sell to the same target market as the 5c.
Based on what Apple said at the Keynote, they are trying to offer most of the new technology features of the Xs/Xs-max in the lower cost and less premium package of the Xr. I think Apple is well aware of the fact that there are cheaper alternatives. The Xr is not Apple's response to the low cost competitors. The older iPhones (8, 7, 6s) are Apple's low cost offerings. I guess what has people worked up is that Apple no longer offers a new low cost option.....SE, 5C, etc.
Apple must have decided that creating a new low cost phone is not profitable given their target market and cost structure, and that it is a better strategy to develop technology for the higher end market and just offer the older phones for people that want to stay in the ecosystem at a lower price. Now, we can all criticize Apple's pricing structure and business decisions, but none of us have access to the type of proprietary information required to make this call. All we can do is vote with our pocketbooks.
Frankly, I think Apple is in a bit of a bind. They are in the higher end consumer technology business at a time when computing devices (laptops, tablets, phones, etc..) are becoming more and more like appliances with less and less product differentiation. The typical MR reader might be well aware of the technology differences, but the average consumer just does not care.
Maybe it is because people are comparing the Xr to prior Apple "economy" devices, like the iPhone 5c. But in terms of product positioning, I don't think Apple ever expected the Xr to sell to the same target market as the 5c.
Based on what Apple said at the Keynote, they are trying to offer most of the new technology features of the Xs/Xs-max in the lower cost and less premium package of the Xr. I think Apple is well aware of the fact that there are cheaper alternatives. The Xr is not Apple's response to the low cost competitors. The older iPhones (8, 7, 6s) are Apple's low cost offerings. I guess what has people worked up is that Apple no longer offers a new low cost option.....SE, 5C, etc.
Apple must have decided that creating a new low cost phone is not profitable given their target market and cost structure, and that it is a better strategy to develop technology for the higher end market and just offer the older phones for people that want to stay in the ecosystem at a lower price. Now, we can all criticize Apple's pricing structure and business decisions, but none of us have access to the type of proprietary information required to make this call. All we can do is vote with our pocketbooks.
Frankly, I think Apple is in a bit of a bind. They are in the higher end consumer technology business at a time when computing devices (laptops, tablets, phones, etc..) are becoming more and more like appliances with less and less product differentiation. The typical MR reader might be well aware of the technology differences, but the average consumer just does not care.
It took me until the fourth page to see a post acknowledging that this is not a sale. Maybe one other person alluded to it but nobody else it getting it. You're selling your old phone and putting the proceeds down on the new phone.
I think the ad is deceptive, personally. But obviously it is effective since everyone is in a tizzy about the phone being on sale.
And it runs Android. Congratulations...it’s junk. The 835 is awful. The a10 is far better from 2 years ago.
217M people last year bought iPhones. If a phone is a commodity for you, it isn’t for MANY others, so you’re just a focus group of one.
Apple still accounts for over 50% of their revenue and most of the stuff you listed is old product which is not bought in nearly the volume anymore. PS3 and ps4? Lol...
Wait until Apple proves everyone wrong when the numbers come out. Happens every time. Every. Time.
Alot of it has to do with people stuck on the resolution of the screen on the Xr not being at least Full HD. Alot of the android offerings are priced similar if not more than the Xr. Yet the Xr will smoke all of them in processor performance and will stand its own with picture quality.
I don't see people raising fuss over the price of the Pixel 3.
https://www.tomsguide.com/us/pixel-3-vs-iphone-xr,review-5838.html
They’re not going to give out numbers, so people will continue to assume whatever helps their narrative.