Analyst says success of Apple iPhone X could mean lower iPhone revenue in 2019 and 2020



Could the success of the Apple iPhone X actually lead to fewer iPhone upgrades in 2019 and 2020? Pierre Ferragu, an analyst with New Street Research thinks so. He said today on CNBC that so many iPhone users upgraded to the iPhone X in 2018 that "We expect a material disappointment in 2019." He adds that even the introduction of a lower priced 6.1-inch LCD screened iPhone model won't make up for the shortfall in sales that he expects.

Ferragu forecasts that Apple's 2019 iPhone revenue will come in 10% under Wall Street expectations. And the analyst points out that when iPhone revenue fails to meet the Street's consensus, the stock usually tanks. As a result, Ferragu is recommending that clients sell the stock, which earlier this month became the first U.S. public company to be valued at $1 trillion.


The analyst says that iPhone shipments are in a downtrend with small bumps in that trend seen in 2016 and again this year. But he sees the downtrend resuming next year and carrying into 2020. Ferragu says that Apple will sell 65 million iPhone X units and another 30 million+ iPhone 8 Plus handsets this year. He compares this with the 69 million iPhone 6 Plus units sold in 2015. As a result, he says that we are still in a supercycle as far as the iPhone is concerned, but he says that the underlying demand for the device is declining. He blames this on the expanding replacement cycle as iPhone buyers are holding on to their phone for a longer time before upgrading to a new model.

Next month, Apple is expected to unveil three new models including a 5.8-inch Apple iPhone X sequel, a 6.5-inch iPhone Xs Plus and a 6.1-inch iPhone 9. The latter will be the lowest priced of the 2018 iPhone models, and will carry an LCD screen. The other two units will feature OLED panels. All three phones will be powered by the A12 SoC and be equipped with the TrueDepth Camera and Face ID.

source: CNBC

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38 Comments

1. toukale

Posts: 669; Member since: Jun 10, 2015

Those analyst have no idea what they are talking about when it comes to Apple. First, they said the X was a flopped. When they were proven wrong, now they think its selling too well, which will affect future iPhone upgrade. Those guys are really clueless at predicting anything Apple related because Apple is doing things that is unconventional and they have no frame of reference to compare.

10. Finalflash

Posts: 4063; Member since: Jul 23, 2013

The iPhone X was a flop by their expectations but it was not a flop on its own merit. This year they are expecting sales to CONTINUE going down because that is the overall trend. They've seen the peak and are now just providing justifications for the expected decline. It is just the natural order of things, you cannot keep going up forever and at some point, everything goes downhill. Usually companies transition to the next great innovation if they are smart but Apple has focused pretty much everything into the iPhone and so that is why it is a sell recommendation because there isn't anything to look forward to.

13. kiko007

Posts: 7521; Member since: Feb 17, 2016

You got any evidence at all to back up that first claim chief?

34. strategic_developer

Posts: 1627; Member since: Jul 17, 2018

What is he claiming. When a product hits the market for a calendar year, it starts high and falls as the year progresses. This has been the case with all Apple product sales. Q3 for Apple has less sales than Q1. This is normal. It doesn't require any proof. Apple expected to sell 50M iPhone X in it's first quarter and yet only sold about 30M by their own admission.

14. Atechguy0

Posts: 918; Member since: Aug 03, 2018

At the beginning of this year Apple already cut their orders down to 30 million instead of the original 50 million. It still sold, but definitely not to the analyst's or Apples expectations. Plus Apple already stopped ordering any new iPhone X's to sell. That is the first time Apple has done this to any of their iPhones, they usual continue to make newer versions of the previous iPhones for the next year as well.

19. c.m.s

Posts: 239; Member since: Dec 10, 2017

According to who? Link to an official source please. Not some rumors. iPhone X sold according to Apple expectations, we have the quarterly report that proves that (the were all inline with Apples guidance).

29. Atechguy0

Posts: 918; Member since: Aug 03, 2018

Apples own Quarterly reports never break out to the public the actual sales of each model that sold. C.m.s. I know you are the real blind Apple zealot that has his head in the sand. You want some links, then you can easily Google search or use Yahoo to find lots of information in regards to this. Plus what about all the suppliers stating the reduction of Apple parts used in the new IPhones at the beginning of the year. Oh, and the best part in May is when Apple buys back 100 billion of their own shares. You know to appease the shareholders and major loss in their stock.

32. midan

Posts: 3131; Member since: Oct 09, 2017

None of those says nothing, huge growth in iPhone ASP tells quite good story ;)

20. midan

Posts: 3131; Member since: Oct 09, 2017

"At the beginning of this year Apple already cut their orders down to 30 million instead of the original 50 million. " Did they really? Apple beat their quidance, if they would have expected to sell 20 million more that would have shown everywhere in their q expectations and Apple would have missed it badly.

35. strategic_developer

Posts: 1627; Member since: Jul 17, 2018

Actually no, this is not the first time that soon after a phone release, Apple cut orders for parts. It also happened to the iPhone 7.

2. smoked_2na unregistered

With every cycle taking something away that was important, ( replaceable batteries, headphone jacks, sd card slots ) it has made it difficult to get excited about slight improvement in the core component. Also giving up $1K for a PHONE has made the excitement impossible.

3. MarvzIsFallen

Posts: 646; Member since: Aug 11, 2017

Analysts are really stupid just like apple haters. When will they stop this nonsense prediction. Apple is so successful in locking their costumers in ecosystem. Now looking forward in their iphone X plus, new ipad pro and  watch this September 14. My pockets are ready.

4. darkkjedii

Posts: 31658; Member since: Feb 05, 2011

No way! Apple rulz the game. Therez no way thiz newz iz true. Apple will sell millionz of iPhonez thiz year, and the store that will sell the most iz located at 281 City Island Ave, Bronx NY 10464. You can take a cab or Uber to it. I think meanestgenius knowz the location. It’s the Hawkins Park Apple store, it rulz.

9. sissy246

Posts: 7129; Member since: Mar 04, 2015

OMG LMAO You know he owns you, oh and me too.

25. darkkjedii

Posts: 31658; Member since: Feb 05, 2011

LMAOOOOOz. He’z gonna beat me up.

31. sissy246

Posts: 7129; Member since: Mar 04, 2015

LMFAO....

18. cocoy

Posts: 464; Member since: Oct 30, 2015

Lol. I think he will not respond to your comment Darkk.

26. darkkjedii

Posts: 31658; Member since: Feb 05, 2011

Awwwwwz lol

27. Sammy_DEVIL737

Posts: 1529; Member since: Nov 28, 2016

But you forgot to mention that the store is open only between 10:00 PM - 02:00 AM.

28. darkkjedii

Posts: 31658; Member since: Feb 05, 2011

LMAOOOOO LMAOOOOO! My bad, see the rep at the geniuz bar.

30. Sammy_DEVIL737

Posts: 1529; Member since: Nov 28, 2016

And don't forget uniform of those representatives "Blue jeans, gray t-shirt".

5. jove39

Posts: 2148; Member since: Oct 18, 2011

Apple don’t need to worry...until iPhone costs less than $500/month.

33. darkkjedii

Posts: 31658; Member since: Feb 05, 2011

LMAOOOOO.

6. piyath

Posts: 2445; Member since: Mar 23, 2012

When was the last time any of these so called "puntids" got anything Right? It's like never. It is their job to make bold statements like this and muddy the waters every now and then. This is nothing more than another stupid analytical statement.

15. Phullofphil

Posts: 1832; Member since: Feb 10, 2009

To lower the stock prices so people can make money when the report that they did average

7. mudcat626

Posts: 231; Member since: Jul 13, 2016

Lol, first the X is not selling, now it is selling too much and no one wants to buy new iPhone. I am waiting on the X plus to replace my 8 plus, like a lot of other users. The so called analysts are really spouting nonsense because of their Apple hate

8. mudcat626

Posts: 231; Member since: Jul 13, 2016

I am getting the new watch to replace my series 0, I have worn and still enjoy since 2015...

11. Rigmaster

Posts: 234; Member since: Jan 22, 2018

iPhone X was a test product in many ways. Apple testing new features, things that could be replaced or removed, and whether $1k was too high for significant sales. Well, $1k is too high for normal incremental changes, but people are willing to pay that much or more for something different. It's hard to imagine Apple really knew what to forecast for sales of the X, but the margins made up for lower sales. In fact, keeping so many versions of the phone for sale (all the way back to the 6S) since it's introduction seems to indicate Apple likely thought X would only be a contributor (not driver) of overall sales. As to the future, not sure why lower revenue would be forecast. In '19 & '20, the "new" features will become things people want. OLED will become the only screen type (or something more than LCD tech). And portless will be a reality that living with dongles will simply be priced out of existence. There are an awful lot of 5-8 models that will be replaced in that timeframe, and they won't be replaced with cheaper options. Add to that, Apple will continue it's walled-garden product introduction and make them interconnected in more ways than imagined. While it's hard to imagine Apple's stock price needing to be lowered by either splitting or something else, it seems awkward that an analyst could conceive it being worth less in the foreseeable future.

16. mootu

Posts: 1541; Member since: Mar 16, 2017

"While it's hard to imagine Apple's stock price needing to be lowered by either splitting or something else, it seems awkward that an analyst could conceive it being worth less in the foreseeable future." They are looking at it that way as it has been kept artificialy high with Apples 2018 stock buyback program. Every time this year that the stock has dropped Apple has spent billions buying back, $50 billion in the first 2 quarters so far, the largest stock buyback in history. So at the end of the day the stock is artificialy high kept there by Apples own market manipulation. It's not illegal but it is frowned upon.

12. sissy246

Posts: 7129; Member since: Mar 04, 2015

I don't believe s**t these Analysts say either but, I do find it funny when they say something good about apple the apple fans love them. Now they are talking bad about sales and fans hate them, lol But I do agree they don't know crap.

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