Apple’s sale in the holiday season for the iPhone X was basically abysmal. The sale analytics of the holiday season marks a diminishing by 11 percent. It is also stated that Apple’s fiscal first-quarter revenue has also pared down by 15% from the previous year.
So as to stop the bleeding here, they have set the production of 40 million units that are to be created. Apple then cuts iPhone X production by 20 million units which is literally the half.
How has apple finally hit the brick wall? Analysis’s say the wall is hit where consumers will not pay a thousand dollars for a phone. Now Apple has said they are going to increase the production of iPhone 7, iPhone 8 and the iPhone 8+ to compensate for the loss of 20 million. Companies producing components will loose billions.
The smart phone industry is dramatically changing. The most important thing in a business is its revenue growth. Apple is known as the premium brand with its premium pricing. But of late it has been a challenge mainly in growth market for smart phones. These growth markets are emerging markets where a consumer can’t afford a thousand dollar smart phone because of the cheaper alternatives. Androids are providing the first computer for most of the developing world.
The demand for the new iPhone in the current quarter has been lessened. It was spurring that the unit sales year over year growth was so small. It was about zero percent but the last year iPhone 10 “didn’t come out until the holiday quarter.
Apple’s prospects in the emerging markets where there are plenty of cheaper options and android competition is fierce. Apple is the inspirational brand in eastern China and in areas where people can afford a thousand dollar phone. In countries like India, Africa, the phones that cost 50dollars, 100 dollars are getting a better every day. Over the long haul most of the world would have android phones. For years there have been discussions about why it is bad that the iPhone makes up about two-thirds of Apple’s sales. The silver lining here is that the revenue is still growing at a remarkable pace but it is also alarming because the unit sales are of zero percent revenue.
There have always been things that Apple has struggled with. Originally, going back to when the iPhone was launched, Steve Jobs made an announcement and said that they are going to delay the release of upcoming macOS to focus engineers on getting the iPhone out on time. It is true that there are more examples, but when you look at it in the context of the company they are still getting the big stuff right. iPhones is two third of the revenue. They are getting it right by empowering the whole services business. On the software side iOS 11 has been routinely criticized for having a lot of bugs and stability problems. Indication seems to be iOS 12 has got a lot of features on the back shelf. Also in the prospects of its shares, Apple’s earnings elevated to more than 5% with the release iin the earnings to $163.47 per share.