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« Smartphone Wars 2015: Now Apple. iPhone sold 231.4 million units for roughly 15% market share | Main | Samsung Q4 Number Almost Official at 82.4M (down 2% from Q3). Full year Sammy 322M (up 2%) »

January 27, 2016


Steven epstein

The only threat to apple long term is mobile cloud app business models 3 to 5 to 7 years from now on 5g. Then the smarter network will impact the upgrade path for billions of users to go out to 3 years plus. Rather than 2 yrs. Now apple becomes the new hated company like MS. Business the same. Mood and trolling becomes different.


On today's call, Apple spent a lot of time talking up their service revenue. While it won't provide iPhone-like growth (those types of products don't come around very often), it is a valid point. Apple has 1 billion active devices out there. They can build ancillary revenue around services, accessories (yes, this is why I think the Watch is here to stay), and repeat business.


Good morning,

A very enlightening article - thank you, Tomi.

A small remark: please change "its" to
or to
it is
in the relevant places.

Have a nice day,


I must say I'm positively surprised to see that you Tomi have finally gotten around to understanding the "where else would you want to have your lead if you could select a category" argument that had been flying around for few years.


Love it. A great read. Never had an iPhone, never will. Yes, a good product but price bordering on extortion. Spec for spec iPhone is still a year or two behind most other brands. Alain DeButton ~ his 2004 book ~ Status Anxiety ~ should rewrite / amend it just for iPhone users.


Could those who keep predicting "peak iPhone" for the next quarter tone it down, now?

Anyway, I hope that Tomi will appraise the figures for the complete 2015 review by focusing on the changes, where signals of evolving market conditions are to be found. Glancing at Apple figures there are two interesting ones:

a) Apple total sales are down in America and Japan.

b) iPad and Mac sales are distinctly down, both in units and in revenue (and I suspect the same is taking place for the iPod, given clear historical trends).

On the one hand (b) confirms that everything is moving to mobile phones. PC sales overall are down anyway, as we know; tablets however may be barely growing overall.

On the other hand, (a) and (b) together potentially highlight an emerging difficulty, as iPhones are both in units and revenue considerably more important than iPads and Macs. So what is happening in Japan and the Americas?

Per "wertigon" Ekström

All you do say is true Tomi. However, I'd just like to point back to the mid eighties, when Windows 1.0 was released.

Everybody laughed at it and ridiculed it, the user experience was abysmal especially compared to the Mac. And yet, windows improved for every subsequent release, and by Windows 95 it was a good enough OS to completely roll over and crush any and all competition. And it STILL sucked compared to the Mac!

Similar things have happened to many other platform makers over the years, and thus Apple would be the anomaly. So while the iOS platform will continue to thrive, I do not think it will survive, especially not now that Jobs is gone. I think Apple will end up like Nintendo - once the ruler of the roost, now severely struggling to keep up as the console market is slowly drying up.

But that transformation will take time and will not happen overnight. Apple is safe for the next decade and longer still. It all depends how much Apple can keep up with new advancements in this field, and how fast competitors can ditch/improve their abysmal UIs (like the TouchWiz). :)

Ahmet Giz


Yeah record quarter,

Iphone DOWN 0.3% Ipad DOWN 25% Mac DOWN 4%




@Ahmet Giz

What I have seen is iPhone up +0.42% in units, +0.90% in money.


All I have to say here:

Remember Nokia in 2010. They were doing record sales, their profits were growing and all looked well on the surface - only to see it all implode a few months later.

Corporate rot has the unpleasant property of only showing itself clearly when it's too late.
And there's definitely some rot going on in Apple - it's only a matter of time if it eats the company alive if they do not change strategy. I have been hearing some very harsh criticism about newer Apple hardware from more levelheaded users - listening to the fanbois won't provide an enlightening picture, but that's what we mostly get here.

Furthermore, Apple's current market shows all the signs of an overinflated bubble - and they tend to burst eventually.

The only question is 'when?'. It will most likely take a few years - so for the near future Apple may continue as usual, reeking in more profits, but at the same time do some damage to their long-term prospects.

And last, but not least:

Up until last year the bi-annual improvements to the phones were so large that any thought of this ending would have been pointless.

But if we now look at the competition which reached the sweet-spot in features two years before Apple, who was fashionably late with larger screens, it's quite evident that most of what newer premium phones have to offer, doesn't interest the potential buyers so much, so one has to wonder how Apple will fare next year.

They'd have to do something truly radical to break this pattern - as of now the only thing that's left is higher resolution displays, but the need of full-HD on a smartphone is already very questionable to many users.

So, whatever they do, another iPhone 6 moment seems unlikely.


Apple might be doing well ...but microsofts's consumer products are really BIG TIME CRAP! Even the NFL is getting screwed by microsoft! ...too funny!

There ar lots of posts like this on YouTube here is just one sample :-)

It's easier and easier to see why NO ONE WANTS WINDOWS ON A PHONE ...or soon, even a SURFACE PHONE (same CRAP just a different label) :-)


Just ridicule for microsoft... stuff. No wonder NO ONE WANTS WINDOWS ON A PHONE! too funny...

abdul muis

According to valuewalk, in the fine print.... Apple were stuffing the channel inventory. so, in reality, sales were down!!!
"Apple’s stock has been battered over the past year due to fears about iPhone unit sales growth. Yesterday’s fiscal Q1 2016 results finally give us some data to understand how realistic these fears are. Apple reported iPhone shipments of 74.8 million units in the quarter, growing marginally over fiscal Q1 2015. However, Apple also increased iPhone channel inventory by 3.3 million over the quarter compared to a decline of 0.2 million in the same quarter last year. Keeping in mind that Apple reports sell-in (shipments), not sales to end users, this implies that iPhone sell-through actually declined by 4.3% YoY, from 74.7 million to 71.5 million units. This is the first such decline in the history of the product."



@abdul, Luca Maestri said that on the call. 3.3 million units is hardly channel stuffing given the volumes involved (and also Apple's normal levels of inventory), and they were transparent about it. Either way, given that the 6 pulled upgrades forward, the 6S is selling well.

I'm a bit surprised they didn't get more questions about the iPad. That seems to be a line that Apple doesn't know what to do with. Introducing the Pro doesn't seem to have helped revenue or ASP all that much. Apple instead focused a lot on services. They seem aware that they are moving from growth to a cash cow with iOS.


@Wayne Brady:

"Apple was supply constrained last year."

Sure. The same lame excuse was brought forward every single time Apple was showing some problems.
You guys apparently cannot accept the fact that the magic has come to an end.
True sheep, indeed.

Earendil Star

Interesting analysis on valuewalk.
What is implied is that for 1q 2015 pent up demand was such that inventories were practically nil lady year. This year instead the large screen effect has waned and actual iPhones sold to consumers fell for the first time ever vs same quarter in 1q 2016.
Again, nothing dramatic, but a vindication that the same market laws also apply to... Apple.
Reference to normal inventory levels just misses the point... not that this is perchance, of course, but still...


What really must annoy the anti-Apple folks here (people commenting, not Tomi) is the timing. They were screaming for "peak iPhone to happen on Q4 and the pro-Apple folks tried to explain that Apple guidance is up, even though slightly, hence unit sales are not down.
This was of course unacceptable. Q4 2014 was supposed to be "pent-up demand spike" that was completely impossible to replicate. Apple could NOT understand their own business.
So not only did Apple sell more but their guidance now is that they will indeed sell less on next quarter. On the quarter which - by the same folks - was in 2015 the "pent-up demand subsiding" down quarter.
So nit only were they unable to tell where the first YoY decline would be but Apple came out and told it for them before they got to paint the doomsday scenarios.

Must be frustrating that Apple knows their own business.

crun kykd

The most interesting part of the call was Tim Cook's comments on VR: "I don't think it's a niche," he said. "It's really cool. It has some interesting applications." As I've been saying, VR is the real driver for all future hardware technology upgrades. Existing cpu, graphics chips, displays, etc are simply not up to snuff. And the desirability of high-end VR is off-the-charts. Watch this space.


People tend to forget that Apple being able to dependably sell 230-250 million iphones year in and year out at super premium price for all of next decade depends on lot of things going right for Apple, and nothing going seriously wrong. Iphone is after all just single product and bulk of Apple's revenue and profit depends on it. Apple has become too dependent on status quo to be a disruptive force any more, but it might find itself being disrupted. Apple's smooth sailing down to 10% global market share by end of 2025 is just one of the possible outcomes, and future could be surprisingly unpredictable and possibly less pleasant for the fruity company.


IIRC Samsung, LG and Sony etc. don't get 75% of their income from mobile phones. A market that will grow in units next year but i doubt if the mobile phone market as a whole will grow in revenue. But hat doesn't matter that much for the Android manufacturers (except Samsung) as stealing from their competitors is their way to grow. Something which is much more difficult for Apple

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