iPhone Q1 Results: Second Year in Row that January Quarter Sales are Down in Absolute Units vs same Quarter the Year Before

So we're into the quarterly sales data in the smartphone wars. Apple reported 50.8 million units of iPhones in calendar quarter 1 ie January-March quarter. That is down 1% vs same quarter a year ago. More relevantly, this is now the second consecutive year that the first quarter of the year starts with unit sales actually down vs the same period the year before. Apple's best-ever Q1 was in 2015, when they sold 61.1 million iPhones. That came down to 51.2 million in Q1 of 2016 and now down further to 50.8 million for Q1 of 2017. Apple's peak year in total annual iPhone unit sales was of course also 2015 with 231.4 million unit sales. That came down to 215.4 million last year and now this weak start to 2017 suggests Apple heading to perhaps flat, perhaps even slightly more down sales this year. The market share picture looks worse, Q1 of last year Apple held 15.3% and now has 14.6% a decline of three quarters of one point of market share.

In terms of annual market share, Apple picked a good year to have declining sales last year, as the industry growth overall stumbled and was essentially flat. So Apple's market share did not suffer much. They dropped from 16.1% in 2015 to 14.6% in 2016. But the industry has returned to growth. The industry is now again growing at 4% per year and now if Apple sales are flat vs 2016, their market share will fall to about 14%. And until the next models arrive, there is nothing to rescue the rest of the year from the regular annual 'down-cycle' that Apple now is in. This before we consider the rumors that the new iPhone 8 may be delayed in its launch. 

If Apple ends at 14% it is nothing to sneeze at, Apple is safely the second-largest smartphone maker still this year, but Huawei might break into double-digits and if this year ends with a race say of Apple around 14% and Huawei around 12%, then NEXT year we could have a real race... Also please remember, Apple is the most profitable company in human economic history and sits on a gargantual pile of cash. They are more rich than god. So don't cry for Apple, they're definitely the biggest winner in smartphones, in handsets, in mobile, in tech and in corporate industry the planet has ever seen. But just don't think the iOS ecosystem is a 'mass market'. It is a niche market for rich people - albeit a very large niche market.  

Comments

[Abdul Muis]

and....

http://www.infoworld.com/article/3074021/chrome-os/why-are-chromebooks-outselling-macs.html

"
Jack_Bohlen: "Well for one thing, the management software is not available in all the markets for iOS devices. That was a huge factor in our decision for going with ChromeOS devices. We have about ~40 iPads (compare that to close to 3000 ChromeOS devices) and it's a pain in the ass to manage them and apps and all that.. "

DrunkJosh: "Having managed thousands of Chromebooks and thousands of iPads, I can say that Chromebook management is a blessing. It really couldn't be easier. I wanted to set all of the iPads on fire any time I had to do anything with them."

Mlts22: "This is what Apple needs to do again. Apple got a lot of mindshare by being very common in education, but has seemed to have forgotten that in the post-Jobs era."
"

[Abdul Muis]

and.... Talk about Apple problem..
Apple got a new problem in China....

https://www.macrumors.com/2017/05/18/apple-chinese-chat-apps-disable-tip-functions/

"Apple has told several Chinese social networking apps to disable their "tip" functions to comply with App Store rules, according to executives at WeChat and other companies.

The tip functions in Chinese messaging platforms are free to use and allow people to send authors and other content creators monetary tips through transfers to mobile wallet accounts. However, according to The Wall Street Journal, Apple has decided that tips are equivalent to in-app purchases – similar to buying games, music, and videos – therefore Apple is entitled to a 30 percent cut of every transaction.

"We don't charge anything as the platform, but Apple gets 30 percent for doing nothing,"

"

https://www.bloomberg.com/news/articles/2017-04-19/tencent-s-wechat-abolishes-tipping-feature-on-apple-iphones

"Tencent Holdings Ltd. is shutting down a popular feature on WeChat that allows iPhone users to tip emoji and content creators to comply with Apple Inc.’s policy on in-app purchases.

After months of negotiations, Tencent said on its official WeChat account it “regrettably” had to abolish the feature on the instant message service to comply with new terms Apple laid down in June. According to Tencent, the iPhone maker said developers would be barred from including buttons or links that direct customers to purchasing systems outside of its iOS ecosystem."

[Huber]

@Wayne: "Inhave had Dells and Macs and there is no comparison to the build quality being much better on Macs. Yes, it's annoying that you can't upgrade the memory, but that's not a NEW thing. So you just buy the memory you need and not "some now, more later"."

_OF COURSE_ a professional device like a MacBook Pro or a Dell Latitude usually gets bought with the RAM which is needed for its task. This is not the point.

The point is that RAM can fail. I had this already. I simply went to the IT maintenance guys of my company and we quickly replaced the DIMMs. If this would have been impossible, it would cause us some headache.

_THIS_ is what I mean when I talk about "serviceability".

What you mean is "upgradeability", and there the new MacBook also is bad - unlike its predecessors. Just talk to a freelancer who used his old device for some years, including upgrading RAM and HDD/SSD. And then ask him what he thinks about the new one.

This can't be hand-waved away, sorry.

[Tester]

@Abdul Muis:

"Apple has told several Chinese social networking apps to disable their "tip" functions to comply with App Store rules, according to executives at WeChat and other companies."

Now, this is something that might develop into a real problem, if those service providers decide to boycott Apple instead of just disabling the feature.

But it's another clear sign that Apple's executives seem to have no grasp on other cultures' mentalities. (i.e. 'The American business model must work there, too.')

I wonder when they try to charge online web stores with the 30% Apple fee... >)

[Abdul Muis]

@Tester

I was wondering
1. what the China govt. will do with that
2*. I think the content creator in WeChat will NOT buy iPhone as their next phone, they will also not buy iPhone for their kids, and will ask their family and friend to NOT buy iPhone too.

* The content creator is someone who make and share original article or perhaps image (memes), and anyone who like it can 'tip' that person. Like 10cents, or $1 or $10.

Meanwhile.....
You can buy/purchase things with HONG KONG BUS Ticket / E-money... OCTOPUS in android, and google did not get a dime.
https://play.google.com/store/apps/details?id=com.octopuscards.nfc_reader

[Gul Dukat]

Apple = not pay tax
Apple = tax 30% us

crazy huh.

[Winter]

@Wayne Brady
"@Huber - according to IBM, Macs have lower cost of ownership. "

Lower COO than Windows, not Chromebooks. That is a low bar to beat.

[Tomi T Ahonen]

Hi Everybody

Just posted the Q1 stats for you... probably you will want to move the debates and discussions to that thread :-)

Tomi Ahonen :-)

[Tester]

@Wayne Brady:

"@Huber - according to IBM, Macs have lower cost of ownership. Macs are increasing sales in corporations because of this - and because of the positive effect on employee moral having a choice. And when they do, they usually pick Macs."

Wasn't that the same weird survey that came up two years ago? That was so full of bogus numbers that I questioned much of its point back then.

Also: TCO for Macs was for devices that didn't have all parts soldered in. I think that 'advantage' will soon be gone if Apple is out on making their computers unrepairable.

[Winter]

Vs a Windows PC

Vs Chromebook
http://m.talkincloud.com/google-chromebooks-vs-pcs-tco-calculator

[Winter]

The Onion on 10 years of iPhone:
http://www.theonion.com/infographic/iphone-turns-10-56349

[Tester]

@Winter:

"Vs a Windows PC

Vs Chromebook"

Yeah, considering that most PCs are still being used to do actual PC stuff that truly makes a lot of sense.