Analyst Ming Chi-Kuo reports "lackluster" first-weekend sales for the iPhone SE

Analyst Ming Chi-Kuo reports "lackluster" first-weekend sales for the iPhone SE

Gunning for a new iPhone SE? No? You are not alone. Apple is tight-lipped about the 4-incher's first-weekend sales, but according to multiple sources, the situation is colored in more of a gray rather than rose-gold. First to give an insider view is the eponymous Ming-Chi Kuo at KGI Securities, who notes that demand for the new Apple handset is "considerably below previous launches".

He's also skeptical about a recent CNBC report which claimed that iPhone orders in China have surpassed 3.4 million. He believes that short delivery times for iPhone SE preorders indicate an unprecedented low demand for the device, which he said is "a smaller-size smartphone that offers no significant upgrades to form factor or hardware specs".

Analysts by Localytics back Kuo's conclusions, describing iPhone SE sales as "lackluster." Citing proprietary research, they claims that the phone "grabbed only 0.1% of the iPhone market" during its first weekend of sales, ranking below the iPhone 5s and all iPhone 6 models.

Mobile industry insiders insist it was high time for Apple to introduce a new entry-level iPhone to succeed the four-year old iPhone 5s. However, they believe that the iPhone SE's 'recycled' 2012-era design is provoking hesitation among buyers and upgraders who are looking for something new on the outside, and not just on the inside. This is sentiment shared by PhoneArena readers and high-profile executives as well. Moreover, many Apple fans are holding off their purchases in anticipation of the probable iPhone 7's announcement in September.

Looking from a wider perspective, Kuo estimates that iPhone shipments won't reach above 200 million units in 2016, which means the iPhone SE will make less of an impact on the Apple's sales than the company hoped for. Considering the market response following the release of iPhone 6s, 6s Plus and SE, Kuo and KGI Securities are "skeptical" about Apple's projected growth for 2016. Still, the iPhone SE makes for a good product tailored towards developing markets like India, Brazil, and China. Apple actually held on to manufacturing the iPhone 4s because it was in demand in India, and might believe that the iPhone SE will spark the same interest.

Additionally, researchers from Mixpanel claimed that nearly one third of active iPhone users are holding onto their 4-inch models and possibly expect an upgrade. And with the unit itself costing Apple a measly $160 per phone to build, it's safe to say that Cupertino has devised a well-thought strategy for the iPhone SE. It knows it's a niche device, despite having all of the iPhone 6s' hardware might. It's aware a 4-inch phone can't sell as well as the big boys, even if it had an all-new design (with all the R&D expenses added) so it minimized risk in order to deliver a powerful, affordable iPhone. We believe Apple knows full well what it's doing, so we'd rather take these gloomy sales reports with a grain of salt.

via TechTimes

Related phones

iPhone SE
  • Display 4.0" 640 x 1136 pixels
  • Camera 12 MP / 1.2 MP front
  • Processor Apple A9 APL0898, Dual-core, 1840 MHz
  • Storage 128 GB
  • Battery 1624 mAh(14h 3G talk time)

FEATURED VIDEO

26 Comments

1. Mercedes-Benz

Posts: 403; Member since: Jan 18, 2015

His mother is lackluster

12. sgodsell

Posts: 6835; Member since: Mar 16, 2013

Everyone knows the most important feature to any smartphone is the touch screen display. It's what you look at and interact with. It's the window to the Internet. So most people have had their fair share of 4" non HD displays. Especially when there is 2k displays that are pushing more than 5 times the number of pixels. Not to mention there is 5" displays or slightly above 5" displays that offer 2k QHD at or close to Apples SE pricing. Apple continues down their path of greed.

25. coldspring22

Posts: 349; Member since: Feb 28, 2015

Precisely - not many people care about how blazing fast the processor is in their phone, as long as it's snappy and easy to use. So phone design, form factor, LCD screen are exactly same as iphone 5/5S, and really, the only significant improvement that average user can see is the rear camera. Not many people will want to shell out $400 for just a better rear camera. But Apple will make money anyway - they spent minimal effort to make iphone SE from spart parts bin of iphone 5/5S/6/6S, so it's gravy train regardless of how many units are sold

18. tedkord

Posts: 17131; Member since: Jun 17, 2009

Burn!

2. Good-Is-Better

Posts: 105; Member since: Nov 12, 2015

I don't want to comment and get banned by PA.

8. bucky

Posts: 3774; Member since: Sep 30, 2009

if youve been banned by phonearena then im pretty sure you deserved it

13. cdm283813

Posts: 424; Member since: Jan 10, 2015

Exactly! I've only been banned on theverge but all of those freaks are overly sensitive. The comment section is now a mess because I bet their afraid of banning any remaining stragglers. They are extremely one sided and any view that does not match up with their objective you will get banned. Said that I was hit on by a owner of a gay bar when I was 16; got banned. Say anything negative about gay people they will shut you up.

3. AstronautJones

Posts: 305; Member since: Aug 01, 2012

The SE isn't expected to be a big seller though, right? Really intended as a filler, i think

10. Finalflash

Posts: 4062; Member since: Jul 23, 2013

No they expected it to be a very good seller. They are desperate to those people with smaller phones to upgrade to their new devices. But likely they are people who got their iPhones second hand and aren't willing to buy a full priced one, now or ever. They are likely going to decline all year, hence why this much effort for so little gain.

14. nctx77

Posts: 2540; Member since: Sep 03, 2013

I think they expect it to do well over time and satisfy a void. I do t think they ever thought it was going to be a blockbuster hit and fly off shelves like a flagship. It kinda seems like that's what the tech media and this guy is comparing it to. I for one never thought much about this phone other than replacing the iPhone 5s. This is not the type of product that we should be tracking first weekend sales. A better product for that is the iPad.

15. ibend

Posts: 6747; Member since: Sep 30, 2014

yeah right... in the last 2 month people often talk about - alot of people have i5&i5s because the didnt want big phone, they want 4inch form factor.. - apple made iSE to fill the emptiness on 4inch area.. - i5&i5s will happily upgrady their phone when iSE released, since its what they wait for 3 years... - iSE is the best 4incher, and there are lots of people who want 4incher.. but those are only iFans word.. none of them are actually buy these phones, all they do is trying whatever they can to make this phone look good, so other iFans will buy it, but they failed, lol there is a hope for humanity :D

4. realjjj

Posts: 375; Member since: Jan 28, 2014

lol the SE is 585$ in India, it won't help sales at all. You can buy almost 4 Redmi Note 3 Pro instead. in China it's priced where the 5S was priced, they won't gain volumes but they are hurting their margins. Then again, it is unlikely that this device was created to boost sales, more likely that Apple just wants to retire the iphone 6 when the 7 arrives and just wanted to still have something bellow the 6S. The orders in China are likely preorders and that in China means that the user left an email, it doesn't translate into purchases and 3.4 million is very low compared to what popular devices get.

5. artificialintelligence

Posts: 166; Member since: Dec 05, 2015

Like I've said before once you go 5" or 5 5" it is impossible to revert back to 4"

6. NoAllegiance unregistered

I guess this is good R&D for Apple, now they have enough reason to stick with 4.7 and above. I think the new mini is 4.7, then your usual size 5.1, then your phablet size 5.5. Then your extreme 6 inch monsters.

7. quintessential

Posts: 86; Member since: Mar 11, 2015

Can't believe the analyst is trying to look at the sales figures of the iPhone SE from a wholly new flagship smartphone point of view. The iPhone SE was never intended for the grand purpose of huge sales turnovers from launch day. It was intended to replace the ageing iPhone 5 and 5S family. Of course the pricing would be high from the start, as with all Apple products. By the time Apple introduces the iPhone 7 and 7 Plus series, they will certainly phase out the production of the iPhone 5S completely, and the iPhone SE will undergo a big price cut to become the new replacement for the 'budget' category. This will mean big sales for Q4 of this year.

17. Macready

Posts: 1811; Member since: Dec 08, 2014

It was meant to turn stagnating iPhone sales back in to growth for the current quarter already, even if we are to believe Cook's predictions (difficult first quarter, recovery after). Based on the report above, it's not all that clear (the suggestion is that the fall in sales from existing models is larger than the gains from the SE) whether it can even fulfill that purpose.

9. athos07m

Posts: 137; Member since: Apr 22, 2012

I'm not a fan Apple (can't/won't afford the overpriced iphone), but to me it is clear that the original iphone 4.7-5.0" should have been the flagship (this takes the bulk of sales), and it's announcement should remain in Sept-Oct region, while the big and small sibling should travel to the spring announcement date, these are niche but together they could push the after-Christmas sales decline. And I would deffinitely do the experimenting with these two (stereo cameras, projector, this kind of stuff) and keep the well-received functions for the flagship 5". I hate that the huge 5.5" gets the flagship status, not the main 4.7" one. I also hate the removal of the 3.5 jack, the lack of FM radio, and a proper strengthened chassis (like LG V10).

16. darkkjedii

Posts: 30830; Member since: Feb 05, 2011

The 7/7+ looms.

19. htcisthebest

Posts: 434; Member since: Nov 15, 2011

Whether or not the SE sells well is bad for Apple. If the SE doesn't sell, it will be a waste of marketing budget, and it will sit on inventory and/or warehouse for a long time which incurs storage costs. If it sells well, it will cannibalize sales of the 6s and 6s Plus. So either situation will be bad for them. At the end it's a stupid decision to release the Stupid Edition anyway.

20. darkkjedii

Posts: 30830; Member since: Feb 05, 2011

You'd make an amazing CEO. ;)

23. AlikMalix unregistered

Wrong! If it doesn't sell well - it will most likely still sell more than any android flagship. And if it sells well it will eat up some of the android low end market. Those that wanted bigger iPhones already got them, those that waited, waited mostly because they wanted a 4 inch device.

26. coldspring22

Posts: 349; Member since: Feb 28, 2015

Wrong!, most people want 5" or bigger phones even at low end. These days you can pay $200 or less and get a great phablet from multiple vendors, such as Xiaomi Redmi Note 3 pro. $400, 4" inch phone with lousy 16G storage is reserved only for ifans, and most people will not bother with it.

27. refillable

Posts: 1071; Member since: Mar 10, 2014

Fallacious. Apple sells products because they're doing business, to get more money. Eating competitors' share is not their goal.

21. jeroome86

Posts: 2314; Member since: Apr 12, 2012

If it doesn't sell well they just drop it. No big deal. Might just be testing the market anyways. Let's get those 7 rumors going.

22. cornerofthemoon

Posts: 619; Member since: Apr 20, 2010

I bought an SE the other day. Even though the 6s is better for my 50 year old eyes I missed the pocket friendly spaceframe of my old iPhone 5. Also it's a better gym buddy.

24. nctx77

Posts: 2540; Member since: Sep 03, 2013

I guess this guy didn't pay attention to all the articles this mornings stating that the SE is sold in most places and the ship dates are pushed back close to two weeks.

Latest Stories

This copy is for your personal, non-commercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customers at https://www.parsintl.com/phonearena or use the Reprints & Permissions tool that appears at the bottom of each web page. Visit https://www.parsintl.com/ for samples and additional information.