Apple Increases iPhone SE Orders Amid Growing Sales Pressures
In line with Apple CEO Tim Cook's recent comments about "very strong" iPhone SE demand exceeding supply, the company has reportedly increased orders for the low-priced 4-inch smartphone in the second quarter of 2016.
DigiTimes claims that the second-quarter outlook for iPhone SE-related chip orders has been revised to more than 5 million units, up from 3.5-4 million, and the upward trend is expected to continue through the third quarter.
In a related report, the Taiwanese website notes that Apple has conversely lowered orders for the iPhone 6s and iPhone 6s Plus due to declining sales of the flagship handsets. Last week, Apple announced its first-ever year-over-year decline in iPhone sales, which dropped to 51.2 million from 61.2 million in the year-ago quarter, and provided third quarter guidance that suggests the decline will continue.
While the lower-priced iPhone SE could help Apple combat its overall decline in smartphone sales, Apple analyst Neil Cybart of Above Avalon notes that the device has a lower average selling price (ASP) and smaller profit margins. Those pressures, alongside other warning signs, leads him to believe that Apple "has a significant iPhone growth problem on its hands" right now.
When looking at all of these iPhone warning signs, it is becoming clear that Apple has a significant iPhone growth problem on its hands. The combination of a slowing iPhone upgrade rate and declining number of growth catalysts for expanding the iPhone's addressable market will make it very difficult for management to report unit sales growth going forward given its current strategy. In addition, the iPhone SE highlights how any strategy to fix some of these issues will likely end up jeopardizing iPhone ASP and margin trends.
One of Cybart's warning signs is that "India is not the next China," despite being positioned as one of the next big growth markets for iPhone. India has reportedly rejected Apple's request to import and sell refurbished iPhones in the country, following a similar proposal rejected in 2015, and its regular-priced iPhones are too expensive to attract significant market share in the region.
Nevertheless, the analyst ensures that the iPhone business is "not imploding," citing industry-leading customer satisfaction rates and loyalty trends. He believes that Apple can pull through this declining iPhone environment with a strategy that involves ditching the "S" model nomenclature, focusing on features that customers truly want, and recognizing the iPhone SE's effect on its broader smartphone lineup.
Popular Stories
Apple is set to release iOS 18.2 next month, bringing the second round of Apple Intelligence features to iPhone 15 Pro and iPhone 16 models. This update brings several major advancements to Apple's AI integration, including completely new image generation tools and a range of Visual Intelligence-based enhancements. There are a handful of new non-AI related feature controls incoming as well....
Wednesday November 13, 2024 11:01 am PST by
Juli CloverA trio of Apple customers this month filed a class action lawsuit against Apple, accusing the Cupertino company of violating California consumer protection laws and false advertising for continuing to sell AirPods Pro models that had ongoing issues with crackling or static sounds.
A few months after the AirPods Pro came out in October 2019, buyers began to complain about crackling, rattling, ...
Apple's camera module supplier for the upcoming iPhone SE 4 is set to begin mass production of the components in December, according to a new report coming out of Korea.
Economic newspaper Ajunews reports that LG Innotek will supply the front camera module for the budget-friendly fourth-generation device. Final tests are now said to be underway, with mass production of the module following...
Apple today released firmware updates for both AirPods 4 models (version number 7B20) and the AirPods Pro 2 with both Lightning and USB-C charging cases (version number 7B21). All of these AirPods models were previously on firmware version 7B19.
It is not immediately clear what new features or changes are included in firmware versions 7B20 and 7B21, but we will update this story if we find...
The M4 MacBook Pro models feature quantum dot display technology, according to display analyst Ross Young. Apple used a quantum dot film instead of a red KSF phosphor film, a change that provides more vibrant, accurate color results.
Young says that Apple has opted for KSF for prior MacBook Pro models because it doesn't use toxic element cadmium (typical for quantum dot) and is more...
Wednesday November 13, 2024 11:59 am PST by
Juli CloverApple last week replaced the M3 Max MacBook Pro with the new M4 Max MacBook Pro, and we picked up one of the new high-end MacBook Pro machines to see how it compares to the prior model with both benchmarks and real-world tests.
We tested an M4 Max with a 16-core CPU, 40-core GPU, and 48GB RAM against an M3 Max MacBook Pro with similar specs. The two machines look similar, but the display on...
Apple today announced the launch of major updates for its Final Cut Pro video editing software designed for Macs and iPads. Final Cut Pro has been version 10 since 2011, but after 13 years, Apple is finally ready to debut Final Cut Pro 11.
Apple first teased a new version of Final Cut Pro when introducing the new M4 Macs in October, and now the updated software is available for download with ...
