CyberTech

Level 22
Verified
Apple is reportedly cutting production orders for its newest iPhones, according to a report from The Wall Street Journal that cites sources that claim that demand for the new devices — especially the iPhone XR — has been weaker than expected.

But while the news may be somewhat concerning at first glance, it might not be as bad as it sounds. This could be the result of Apple’s changing iPhone strategy, which has focused more recently on raising the amount of money it makes off of each device, instead of driving prices lower to goose sales numbers. Last quarter, the company saw a 29 percent revenue increase in its smartphone division with a 0 percent change in iPhone unit sales year over year, so it’s a strategy that seems to be paying off.

We saw similar predictions of falling-off Apple sales with the iPhone X last year, which ultimately turned out to be nothing but speculation. Despite fewer sales, Apple’s first 2018 earnings report earlier this year showed that the iPhone X had driven the company to an 11 percent increase in revenue. Apple CEO Tim Cook noted that the “iPhone X surpassed our expectations and has been our top-selling iPhone every week since it shipped in November.”

There’s a good chance that we’ll see a similar pattern with the iPhone XS and iPhone XR models this year, which are Apple’s priciest iPhones. Apple is no longer planning to disclose unit sales for its devices during its quarterly earnings reports going forward, so it will likely be harder to tell whether the reports of diminished demand are true. But if Apple can keep its streak going from last year by posting increased revenue numbers, it likely won’t matter to investors how many iPhones it actually sold.
 

crezz

Level 5
Verified
The latest models released this year are very, very expensive.

I bought an iphone SE which was more reasonably priced but I will be going back to Android unless Apple drop their prices.

Apple products are very good (and more secure) but they do exactly the same as Android devices which cost half the price. I question how much longer they will be able to charge a such a large premium for their products ? I suspect Apple might have reached their peak and are now in decline- unless they can bring a new innovation to the market.
 

mlnevese

Level 16
Verified
The latest models released this year are very, very expensive.

I bought an iphone SE which was more reasonably priced but I will be going back to Android unless Apple drop their prices.

Apple products are very good (and more secure) but they do exactly the same as Android devices which cost half the price. I question how much longer they will be able to charge a such a large premium for their products ? I suspect Apple might have reached their peak and are now in decline- unless they can bring a new innovation to the market.

For the last few years Apple has been behind all other big players in innovation.. .If you want to see new technology it's often available first in one of the other big players' flagships. I like apple products but their pricing is insane. Just as an example I could buy 3 Galaxy Note 9 in my country for the price Apple is asking for an Iphone XR...
 
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For the lat few years Apple has been behind all other big players in innovation.. .If you want to see new technology it's often available first in one of the other big players' flagships. I like apple products but their pricing is insane. Just as an example I could buy 3 Galaxy Note 9 in my country for the price Apple is asking for an Iphone XR...
What. Every phone manufacturer other than Samsung copies Apple...
 

crezz

Level 5
Verified
There are differences between the business models employed by Apple and Google though.

Apple's business model is based on paying cash for the device and operating system, whereas the Google approach is about giving away Android for free and then selling your data and personal details to make a profit. I know Apple like collecting data as well, but it's not like their entire business model relies on this.

The other thing with Apple is the quality of the after-sales support that is available. If you walk into their stores the staff are willing to spend a great deal of time showing people "hands on" how their device works or resolving problems with older equipment. I understand that high levels of after-sales support are also available online and by telephone if necessary. This is obviously very expensive to maintain.

Google and thrird-party phone manufactureres do not offer an equivalent level of customer service.

Despite this, I think that Apple will lose loyal customers if they make their phones too expensive. I think a lot of people will put off buying iphones in the future if the current pricing structure is maintained.