Did we see a near term peak in Apple iPhone sales during Apple's fiscal first quarter?

Did we see a near term peak in Apple iPhone sales during Apple's fiscal first quarter?
Information from Apple's last quarterly report, and from Taiwan's handset supply chain, have led Digitimes Research to predict a rebound in Apple iPhone shipments for the company's fiscal third quarter. In the second fiscal quarter, Apple did beat Wall Street estimates that called for 50.7 million units of the phone to be sold in the period.

Apple announced that it rang up 51.2 million handsets during the three months from January through March. That was 10 million less than the same quarter last year, making the just announced quarter the first to produce a year-over-year decline in iPhone history. But what really hurt was the drop in the average selling price to $641 when Wall Street expected the ASP to be $658. And that average will continue to go lower.

Digitimes Research sees a disturbing trend with demand shifting toward lower priced models like the Apple iPhone 5s and Apple iPhone SE. During the first half of this year, Apple will produce 12 million units of the iPhone 5s. Production of the new iPhone SE is supposed to rise in fiscal Q3 and Q4 of this year. The iPhone 5s and iPhone SE will make up a quarter of Apple's fiscal third quarter iPhone shipments. That will take the average selling price down even more to $600.

Digitimes Research expects to see 41 million to 43 million iPhone units shipped in the current quarter which ends in June. That will be followed by shipments of 45 million to 48 million for the following three month period. For all of calendar 2016, Digitimes sees a year-over decline to 210 million phones delivered. That would be a decline of 4.9% to 9.2% from last year's total. Connected Apple analyst Ming-Chi Kuo of KGI Securities sees iPhone shipments this calendar year ranging from 190 million to 205 million, even lower than Digitimes' forecast.

The sell-through rate for the iPhone dropped less than 5% year-over-year during the fiscal first quarter. That expanded to a 14% decline during the fiscal second quarter. Apple could turn this around with a strong holiday quarter led by the Apple iPhone 7. But Ming-Chi Kuo sees nothing in the iPhone 7 that he would consider "an attractive selling point." And that could mean that the 74.8 million iPhone units Apple sold during its fiscal first quarter could be the peak number for some time.

source: Digitimes

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33 Comments

1. zunaidahmed

Posts: 1185; Member since: Dec 24, 2011

Honestly, I do like the SE way more than 6s or 6s plus, really hate the "new" design, seems like a toy cookie phone that could be baked out of an oven by a 4 year old

4. NoToFanboys

Posts: 3231; Member since: Oct 03, 2015

+1 new design is crap, SE over 6s anyday.

10. Jimrod

Posts: 1605; Member since: Sep 22, 2014

Agreed. I see many reviews saying it's too small and not an upgrade from 6/6S but I think they completely miss the point... I might get an SE rather than a 7 (or, potentially, an Android phone) because I like the form factor and ergonomics of the smaller iPhone 5 shape for 1-handed use. (I prefer the volume buttons and power button placement too so you don't press them both together!) Somehow we all used to manage with a 4" screen perfectly well before phablets came along...

13. BradyCrack

Posts: 835; Member since: Dec 29, 2015

iPhone 4 was my favorite design. Still, saying that you'd get the SE over the IPH7 is a very bold statement. You must really like that size!

14. Jimrod

Posts: 1605; Member since: Sep 22, 2014

If the iPhone 7 has a lot to offer I'll certainly consider it, the rumours so far suggest it'll be more of a "6SS" though, we'll see... I'm not going to spend a load of cash on something just because it's the newer model though, it'll have to actually be better to justify it! The iPhone 4 looked the best but it's a bit of a heavy old brick nowadays (I've got one on my desk) so the 5 was better in-hand. I'm due an upgrade in September so it'll depend what's out really, I do miss the smaller size and not having to have a case because the 6 is more awkward to hold...

19. BradyCrack

Posts: 835; Member since: Dec 29, 2015

Yeah, maybe they could use metallic glass (liquid metal) instead of the steel they used in the iPhone 4 for the iPhone 8 design. It's lighter and stronger. I just really hope Tim was talking about REAL wireless charging for the iPhone 7. We'll see.

22. marorun

Posts: 5029; Member since: Mar 30, 2015

the tech not fully ready for real wireless charging so sorry.

28. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Yes 5S/Se design, but make it bigger.

2. kiko007

Posts: 7521; Member since: Feb 17, 2016

I'm just going to leave this here: Unit Sales (Millions) Q2 2011 (IPhone 4). 18.7 Q2 2012 (IPhone 4s). 35.1 Q2 2013 (IPhone 5). 37.4 Q2 2014 (IPhone 5s). 43.7 Q2 2015 (IPhone 6). 61.2!!!!! Q2 2016 (IPhone 6s). 51.2 Everyone see the anomaly here correct? For all intensive purposes, the IPhone 6 has spoiled Apple stockholders and analysts alike. There is no way Apple could maintain that level of momentum even if the entire market wasn't leveling off. We have to reassess our expectations to fit the norm, not the anomaly. I don't expect another 60 million quarter for at least a year (debut of the IPhone 8/7s). The perplexing issue, is why they didn't see that level of growth as an anomaly and acted accordingly, rather than pretending it was substantiable. Regardless, I fully expect Apple to exceed those projections for the IPhone 7 that quarter by a few million simply because of past events. New IPhone models launch, people buy them. Simple as that. There decline in sales were inevitable not because of anything anyone else has to offer, but because of simple common sense. Shame many can't grasp the concept.

6. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Lol its not an anomaly because that boost came from officially launching in China. The current iPhone also launched in China and that means they had the same markets available to them as they did last year. They largely blamed it on the Chinese market slowdown as well. So please don't make excuses and understand that it isn't an anomaly but an abject failure to get interest in the 6s.

20. kiko007

Posts: 7521; Member since: Feb 17, 2016

These aren't excuses and that was an anomaly. How many "official" launches can you have in one country? One.....that is it. The Chinese market didn't "slow down" later last year the Chinese economy saw an unstable shift that lasted months. That affected stock prices across the board. Not to mention a strong USD potentially causing an increase in importation feesamong other things. That post wasn't an excuse, it was a realistic assessment of the current situation. There was no failure to generate interest, that is a biased assessment on your part. Recently the Chinese government has begun to root out Apple services, such as IBooks and ITunes, severely hindering Apple services within the country. It'll take months to get them back up. And while speaking on launches, Apple has seeded it's chance for an Indian market launch as well. Those two nations hold 34% of the entire human population. That still doesn't mean sales will reach what we saw Q2 of last year. Last year was exactly what I said, an "anomaly". Certain conditions proved extremely beneficial to Apple that won't happen within the next few quarters.... and that isn't baseless speculation unlike your own post.

23. marorun

Posts: 5029; Member since: Mar 30, 2015

talk big and all but you did not provide those Certain conditions as you say. So as long as you dont explain why this anomaly happened you are speculating as well. Its was a fact china waited for a long time for a bigger screen iphone in china bigger always better and thats a fact.

26. kiko007

Posts: 7521; Member since: Feb 17, 2016

Lol. You just said the damn conditions in your post. The launch in China and the size increase, it doesn't take rocket science bro. Can you actually look at the f**king numbers before posting. You see Q2 2015. That's odd....the sales increase more than doubled from the previous term. What does that mean? Certain conditions lead to a quarter of tremendous growth. Well why did it not continue? Because that scenario couldn't occur again. The 6s and 6s plus maintained the same size, and China's economy went through a low period right after launch effecting sales even further. This s**t isn't a Scooby-Doo conundrum, you should have figured this out on your own.

30. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

I can explain. The anomaly was, the iPhone finally got bigger and all the people who wanted one bought it then and they didn't need the 6S which offered no benefit over the previous model. Same design, crappier camera, 3D-Touch garbage and a new color just isn't enough to spur sales.

8. ibend

Posts: 6747; Member since: Sep 30, 2014

My prediction as self-proclaimed analyst Unit Sales (Millions) Q2 2017 (IPhone 7): 44 Q2 2018 (IPhone 8): 33 Q2 2019 (IPhone 8s): 22 Q2 2020 (IPhone 9): 11 Q2 2021 (IPhone X): 1

21. kiko007

Posts: 7521; Member since: Feb 17, 2016

That's literally impossible without an outside force involved, such as the Chinese government pulling what they did with Google. Try not to be biased when reading factual information. And besides, why do so many here want less competition in the mobile field? I don't like using Android on my primary devices, so in the impossible event the IPhone were to stop being produced, I'd move to Windows Phone. You would think that as great Android is to some of you, ONE OEM wouldn't rattle you so much (that same fruity OEM also makes all the profit in the mobile space as well, so it seems consumers aren't really interesting in Android services outside of Google and Samsung Pay). I digress, all of you continue your Matrix level delusional parade where the misfortune of one of the most valuable companies in the world is celebration material. Almost forgot to add that the 10.5 billion in profits they made in three months, was more than all but 15 companies in the S&P 500 index make on an annual basis. BUT THEIR DOWNFALL IS CLOSE AT HAND!!!!!!/s

24. marorun

Posts: 5029; Member since: Mar 30, 2015

Well i want more ios device maker. So governement should force Apple to sell lisence to ios. Would love an ios device with real hardware. you do know thats benchmark and all those are flawed if not running same OS right? lets take an S7 and put ios on it and its will be good for 5 years of update. Take an iphone 6S put android on it and its will lag like crap. i want more competition on the ios space price and quality would be improved for us consummer.

27. kiko007

Posts: 7521; Member since: Feb 17, 2016

And I want to stand on Mars. Doesn't mean it's gonna happen. A) The government has absolutely no authoritative ability to affect IOS at all. Literally no act under constitutional litigation allows them to disperse IOS. I would love to see an S7 Edge running IOS, too bad it will never be possible. B) You know, you basically just called Android s**tty right? The IPhone 6S has one of the most powerful SoCs ever put into a mobile phone, and you are saying it wouldn't be enough to run Android. Meaning that the OS is an unoptimized mess built by a company trying to sell your porn habits to the highest bidder. You should choose your words more carefully in the future. But I really want that S7 Edge running IOS. That would be so bossssss!!!!!

31. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

We aren't celebrating Apple falling. What we are celebrating is this is what it took for Apple to finally decide to actually do something with their products aside from releasing the same product year after year and raising the price and giving nothign for it. I personally dont want Apple to fail. I do want them to do better. Since they refuised to listen to their customers mouths, they can listen to them voting with their wallets. After all that si the best vote of all. Need examples? Microsoft was ridiculed with WP7 simply because it didn't have copy/paste? It took Apple 3 models to bring copy/paste to the iPhone. Apple has been ridiculed for the phone size since 2010 and yet they waited 6 years to make it happen. Every single iPhone model has had issues with the modems and connections, yet the iPhone 4 was the one that had he most pronounced issues. Apple too busy working on things that didn't matter like thin and graphics. As fans claim we dont need 1440p displays and blah blah blah. How much FULL HD content is their on the internet? WELL THERE IS A LOT NOW. Yet Apple refuses to even use standard resolutions. What exactly is 750p? The standard is 720 then 800p. There is nothing in between. Appel constant refusal to use industry standard because making a buck from propritary useless BS where they force you to buy it once you buy their phones or computers is stupid. All because its an excuase to charge more money, yet you still get less. Example. Thunderbolt is useless. It is a high-bandwidth expensive revision too SCSI. It is a perfect solution for business or peopel who work in specific media production industries or have servers where they need to move a significant amount of data. How many peopel would need that? fgew when compared to everyday users who outnumber niche markets. USB won, not the speed race, but the flexibility race. It was "fast enough", but had alternative usages such as powering low level devices like mice, keyboards, storage, displays and more. That fact you can daisy 127 devices on one hub and still have a consistent amount of power on all of them is awesome. You cant do this with high bandwidth controllers because they suck power. Try using Thunderbolt on a Mac battery vs a typical USB 3.0 and see what happens. Apple problems has always been greed. They are not about massive usage. They want a control niche market because once you get enough people in your guarantee a money stream where you can rape people for cash even for stupid stuff and you dont have to directly compete This is why other platforms offer more for less. Because they all have the same stuff. They all try to out-due each other and their last resort is price battles. Apple never have to battle costs because no one is using their crap but them. So they charge ridiculous costs to have it. It makes money at once, but not over time because you cannot sustain such. Once other OEM use better stuff, Apple gets dropped.

32. kiko007

Posts: 7521; Member since: Feb 17, 2016

I can get behind almost all of what you said here, because you have objectively. The 750p thing... I don't know what they were thinking when they decided on that resolution. I would have put a 1080p panel on both models and simply raised the 6 plus camera MP by 3 to differentiate between the two models. I would love for them to move to type-C USB within the next two years, because their proprietary cords are terrible. I haven't personally experienced the connectivity issue myself, but I've heard about it. I can't say they are greedy, more like money is too involved in their narrative. I don't want them to be Tesla, but they need to change their philosophy a bit. They have the funding to outdo anyone in mobile. They could put make an IPhone with: 4k UHD screen, 5000 mah fast charging, 6Gb of RAM, 256Gb ROM monster if they really wanted to. However, they are too cautious when it comes to their profit margins (even though most of the items mentioned aren't that much more expensive than current IPhone parts) and that is what is holding them back. I doubt the individuals in Cupertino are so stupid/arrogant enough not to change the way they do things. Or perhaps they have something in the works that will excuse their actions. Regardless, they need something more than iterative spec upgrades in the next year or so. I don't care how the IPhone 7 looks as much as I care about what it does (IOS to a certain degree as well).

29. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

But those sales numbers are all based on ALL SELLING AVAILABLE MODEL. Those are not numbers for one single selling model. The 18.7M iPhone 4's were also sales of the 3GS. Just remember this. Apple fiscal 1st quarter means, the phones in that quarter will be mostly older models doing the most sales. Then in Apple's fiscal 2nd quarter, the new phones take over on sales and by their 3rd quarter, the older model certainly will be even lesser of those counted sales. But every quarter for Apple includes ALL SELLING MODELS. Not one model.

33. kiko007

Posts: 7521; Member since: Feb 17, 2016

Yeah I missed explaining that. I put the yearly models there to give a better understanding of the scope of change the IPhone 6 was for Apple (China too) including the other selling models at the time. If I recall correctly, the 5, 5c, and 5s were all still in production.

3. SIGPRO

Posts: 2817; Member since: Oct 03, 2012

iphones have no future.........is just a dead phone walking!

5. scarface21173

Posts: 702; Member since: Aug 17, 2014

Dead phone ringing you mean

7. SIGPRO

Posts: 2817; Member since: Oct 03, 2012

Hahah yes :P

16. lee480 unregistered

So you're trying to tell me Galaxy phones have a bright future ahead?

17. SIGPRO

Posts: 2817; Member since: Oct 03, 2012

No i did not those are your words!

9. ibend

Posts: 6747; Member since: Sep 30, 2014

did we really need to talk about apple first fiscal quarter? again? they already release the second fiscal quarter, and cant we just wait until 3rd fiscal quarter, since there is nothing to discuss.. or maybe try to post article about other companies, since apple isnt the only phone manufacturer in the world

11. Jimrod

Posts: 1605; Member since: Sep 22, 2014

If you don't click on it and don't comment on it perhaps they'll go away? As it stands it seems any iPhone/Apple article gets most clicks and comments from people who like them and trolls who hate them alike! For Phonearena clicks are income...

12. BradyCrack

Posts: 835; Member since: Dec 29, 2015

Actually, when you think about it. You're completely right.

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