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Rumor: Apple reduces iPad 2 orders by 25%, could drop price - Page 2

post #41 of 105
Quote:
Originally Posted by eksodos View Post

Amazes me people think reports like this couldn't possibly credible. Europe is turmoil with consumer confidence falling through the floor. Do you think when people are worrying about debt, job security and making ends meet they are going to continue blowing money on high-end luxury products like the iPad and iPhone? The US is in awful shape too with consumers also feeling the pinch and confidence way down. So many people are cutting back on their spending, I believe it's impossible for Apple not take a hit from all this turmoil.

Anyone buying or holding onto Apple shares at current prices is a hell of lot braver than I am.

I've held mine since 1996.
post #42 of 105
Quote:
Originally Posted by ErosLWS View Post

What exactly do you do on it that is intrinsically easier than on your Macbook, AppleTV, and iPod? (I mention those three because I own them.)

I've found surfing the web is easier, it feels natural, but if I'm running SPSS and Excel on my Mac, I'm already on the computer so convenience defeats ease of use. My favorite thing is to use the iPad as a vacation device; it's great to take with me on a plane and into a hotel. Once there, I can transfer all my images to my iPad from my DSLR whenever I get back to the hotel from a trip out. This is where I see iOS 5 being unbelievably useful. And yes, gaming is pretty kick ass on the iPad but I um....prefer getting out; why play a snowboarding game when you can actually snowboard? Why play an FPS when you can actually go out to a range or go hunting?

I guess my problem is with people claiming it's some magical productivity device. It's a luxury item or an adult toy, and a pretty good one at that. I am happy with my investment, I just have other priorities.

Well I travel nearly every week and also visit multiple client sites every day. For me it is a magical productivity device. If there was some easy way to access email archives, a decent project planning tool and a visio substitute, I would leave my MacBook at home. I think al of those needs will be met in the relatively near term. Just because you don't understand use cases beyond your own does not mean they don't exist.
post #43 of 105
Quote:
Originally Posted by Wovel View Post

Where do you see the iPad 2 with a price cut?

You're right. The article says:" prompting the company to slash orders by 25 percent and potentially enact a price cut."

It is not a "price cut", but a "potential price cut".
post #44 of 105
Quote:
Originally Posted by spinnerlys View Post

Apple introduced the iPhone in early 2007 and released it in mid 2007, in 2008 it released the iPhone 3G, then in 2009 it released the iPhone 3GS and in 2010 it released the iPhone 4.
All those releases happened mid year and NOT short after the fourth calendar quarter, which would be the beginning of the next year.

Or is this just SPAM?

It's not spam... he/she just got the reason wrong for the reduction.

During the calendar 3rd quarter Apple ramps up production for the holiday quarter and then during the 4th quarter they cut production for the slower Q1 2012* (Apple's fiscal Q2).

[*on edit - ... and for the introduction of iPad3]
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post #45 of 105
Quote:
Originally Posted by johnnielse View Post

I think the report is either false and an attempt to make AAPL drop a few points before the iPhone announcement, or true, indicating a new iPad in the coming months.

With Apple aggressively expanding into Asian markets I don't see this being a case of lower demand.

Maybe in January they will have their "MacWorld Companion" press event, announce iPad 3 with availability on 2/3... So 2 months or so earlier than normal.

Quote:
Originally Posted by jragosta View Post

How do you pump a stock by saying that their sales are declining?

Get people to sell now, lowering the price, then you can buy now, and next week it jumps on iPhone announcement.

Quote:
Originally Posted by djsherly View Post

My belief is that they may be bringing on new suppliers. However, the world economic outlook is pretty grim, Apple with their supply chain expertise would be the first to shut down any potential exposure.

They may be seeing their inventory rise above x days. they don't want to be left with a few millions tabs when the next one comes along.

Disclosure: I hold no stock and am basically thinking aloud.

Excellent points.
post #46 of 105
Glad you asked!

Quote:
Originally Posted by ErosLWS View Post

What exactly do you do on it that is intrinsically easier than on your Macbook, AppleTV, and iPod? (I mention those three because I own them.)

True mobility and functionality combined. I cycle to meetings and teaching assignments etc. The reduced mass over my 15" MBP is significant in this respect. I can present information and lectures from the iPad quite happily.

Quote:
Originally Posted by ErosLWS View Post

I've found surfing the web is easier, it feels natural, but if I'm running SPSS and Excel on my Mac, I'm already on the computer so convenience defeats ease of use. My favorite thing is to use the iPad as a vacation device; it's great to take with me on a plane and into a hotel. Once there, I can transfer all my images to my iPad from my DSLR whenever I get back to the hotel from a trip out. This is where I see iOS 5 being unbelievably useful. And yes, gaming is pretty kick ass on the iPad but I um....prefer getting out; why play a snowboarding game when you can actually snowboard? Why play an FPS when you can actually go out to a range or go hunting?

This just highlights our differing requirements - your uses and mine are equally valid.

Quote:
Originally Posted by ErosLWS View Post

I guess my problem is with people claiming it's some magical productivity device. It's a luxury item or an adult toy, and a pretty good one at that. I am happy with my investment, I just have other priorities.

I have all of my papers, other documents and data visualisation images and videos on my iPad. I record data to it, use it as a calculator (with big keys ) and use Maps a lot. It's an everyday device, perhaps a luxury item but not a toy. To me, it is magical, not because the technology blinds me, I was building accelerometers and flash memory into devices 14 years ago but because of the enabling it provides.

All the best.
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post #47 of 105
Quote:
Originally Posted by ErosLWS View Post

What exactly do you do on it that is intrinsically easier than on your Macbook, AppleTV, and iPod? (I mention those three because I own them.)

I've found surfing the web is easier, it feels natural, but if I'm running SPSS and Excel on my Mac, I'm already on the computer so convenience defeats ease of use. My favorite thing is to use the iPad as a vacation device; it's great to take with me on a plane and into a hotel. Once there, I can transfer all my images to my iPad from my DSLR whenever I get back to the hotel from a trip out. This is where I see iOS 5 being unbelievably useful. And yes, gaming is pretty kick ass on the iPad but I um....prefer getting out; why play a snowboarding game when you can actually snowboard? Why play an FPS when you can actually go out to a range or go hunting?

I guess my problem is with people claiming it's some magical productivity device. It's a luxury item or an adult toy, and a pretty good one at that. I am happy with my investment, I just have other priorities.

Actually, your problem is the "if it doesn't fit my needs, it must be useless, or a toy" problem.

It clearly doesn't fit your needs, workflow, or usage patterns. However, there are millions for whom it does.
post #48 of 105
Quote:
Originally Posted by iCarbon View Post

There is something deeply fishy with these reports.

A Shift from 17 to 13 million is a huge alteration -- and not the kind of screw-up we've ever seen from Tim Cook. I can only imagine two possible explanations:

1. the report is complete BS spread by someone selling AAPL short.
2. they actually will update the iPad this quarter... something I highly doubt (they rarely deviate from their product release cycle that much, and would gain little as the iPad 2 is still selling well).

Much logic here, and it also explains today's unusual dip in Apple's stock price. (I think the market's going south ANYway, but today's drop is well ahead of the curve.) However, this would not be a tactic to short Apple stock, but more likely just a tactic to buy in at a better price.


Quote:
Originally Posted by mr O View Post

You're right. The article says:" … prompting the company to slash orders by 25 percent and potentially enact a price cut."

It is not a "price cut", but a "potential price cut".

Yes, and the presumption is that a price cut in the iPad 2 is 'bad'. I suppose it is, if it reflects only a slackening of demand (as the 'slashing' of orders suggests) and nothing else. But it could also reflect this:

• The (higher-res, more capacity) iPad 3 is on the way
• More pressure on competitors, as the iPad 2 becomes the 'low-price end' of what will become a model line

Or, as per djsherly's suggestion, it could merely mean new suppliers are coming online. We have all read about Apple's desire to be less dependent on Samsung, for example.
post #49 of 105
Quote:
Originally Posted by kevinh View Post

Apple is getting ready to into the iPad 3.

That was my first thought as well. Maybe the anticipated Amazon tablet has accelerated the release.
post #50 of 105
Quote:
Originally Posted by jragosta View Post

How do you pump a stock by saying that their sales are declining?

I think he means that the 'pump' phase was when AAPL got to ~$420, and now we're in the 'dump' phase (thereby also helping a few short-selling clients along he way).....
post #51 of 105
Quote:
Originally Posted by shawnb View Post

I don't think Apple has ever set prices based on demand.


Unless they have a pricing theory which is different from every other manufacturing company on earth, they set their prices based on demand every single time for every single product.
post #52 of 105
It is possible that Apple merely tries to diversify its suppliers (or move away from potential lawsuit candidates) and hence reduced orders with current suppliers.
Also after the Japan earthquake it became obvious that heavy reliance on one region is dangerous. Apple might merely reduce their dependence on Taiwanese suppliers.
Which analysts promptly interpret as iPods being in less demand.
Does anyone remember that Brazil is gearing up to produce iPads Q4? Maybe they are switching to South American component suppliers too? Could be another reason to reduce Taiwanese supplier orders.


While not as likely I still could see an iPad HD happening sooner than later, which could also mean current suppliers get their orders reduced.
I am sure Android tablets will play the 'but we offer HD displays' trump card massively (read 1280x720 resolution).
The current A5 is quite capable of driving a retina display. So if Apple were to clock it at 1.2GHz and offer an iPadHD with retina display this could be the one-two punch those Android tablets would not have seen coming...
Granted, not so likely perhaps, but I can still see an iPadHD surprise happening before the holiday season. Even if only in limited numbers.


The bad economy in Europe or the world even could be used both ways too.
I remember last year the biggest sellers were notebooks. It surprised me how many people gifted small laptops at Christmas time (and not merely netbooks).
With a worsening economy perhaps these people will not spend as much, but still have enough dough to gift an iPad.
Or in other words, the trend not being able to afford more expensive computer equipment might give the iPad a boost.
I would not be surprised if Apple sells 15-20mio over the holiday quarter.
post #53 of 105
Quote:
Originally Posted by mdriftmeyer View Post

I've held mine since 1996.

Congratulations you've obviously done very well. I still think you are brave to hold onto them now and not sit back, watch from the sidelines with your very significant profit on your initial investment banked. I'm not convinced the global economy can be propped up too much longer. I think we're nearing the end game now where we all have to take the medicine and suffer a genuine global recession, possible depression given all the damage world leaders have done to postpone the inevitable.

I obviously love Apple, but I can see them suffering terribly when the proverbial s*** hits the fan. And even when the economy does slowly start to mend itself, with governments around the world finally getting out the way, Apple will need to rebuild its position without Steve Jobs guidance. Another huge question mark as far as I'm concerned.

Anyway I sold my Apple shares quite a bit below the current prices as this storm has continued brewing. So I don't look too clever right now. But I still think I'll have the opportunity to gain a new entry point far below the price I sold at in the next 12 months, just as I did in 2008.

We shall see. Good luck though, and well done with your long-term investment strategy.
post #54 of 105
Quote:
Originally Posted by shompa View Post

TSMC 28nm revenue in Q4 is less then 3%. That is not enough to produce enough A6/AMD graphic cards/Nvidia graphic cards.

I assume you mean 3% yield (ie: 97% defect-rate)? Do you have a source for that figure, because it sounds ridiculously low, and not something TSMC will be able to fix before 2012?
post #55 of 105
According to CNBC JP Morgan is now trying to downplay the earlier report and they do NOT see a downturn. They must have opened whatever options contracts they were after this morning...
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post #56 of 105
I'm calling BS. Here's how you know it's a load of crap: You still can't buy iPad 2's online anywhere but Apple. Not amazon (one of Apple's biggest resellers), not any of the old school Mac online stores (they say "Call Us"), not anywhere. Dumb "story".
post #57 of 105
Quote:
Originally Posted by eksodos View Post


Anyone buying or holding onto Apple shares at current prices is a hell of lot braver than I am.

When you sell. I buy
post #58 of 105
Quote:
Originally Posted by anantksundaram View Post

I think he means that the 'pump' phase was when AAPL got to ~$420, and now we're in the 'dump' phase (thereby also helping a few short-selling clients along he way).....

The cut in production for calendar Q4 is probably true but it's being thrown way out of proportion for the dump phase just prior to the calendar Q3 report.

I really don't expect Apple to produce as many iPads for calendar Q1 2012:
a) holiday season is over
b) intro of iPad 3
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post #59 of 105
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Originally Posted by monstrosity View Post

When you sell. I buy

That's my nickname on the trading boards... buywhenisell.
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post #60 of 105
Quote:
Originally Posted by ConradJoe View Post

Unless they have a pricing theory which is different from every other manufacturing company on earth, they set their prices based on demand every single time for every single product.

According to legend, when IBM was about to release the revolutionary Selectric "Golf Ball" typewriter in the early 1960s, it went through its final price/forecast cycle.

The Selectric was cheaper to manufacture, had fewer parts (1 typeball vs about 36 typebars) less, easier movement (tilt-rotate, move the typball) vs (typebar up typemar down, move the platen) -- and was much more reliable. than conventional typewriters.

IBM's forecast said that they could make their profit and sales objectives by by pricing the Selectric at near the high-end competitors products.

The story goes, that given all the data points, the Pricing committee decided to double the suggested "optimal" price.

AIR, the Selectric was priced at $400 and rapidly gained 70% market share.

My point is that pricing is somewhat of a black art, and can be based on many things, including (but not limited to) demand.

Think about it!
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post #61 of 105
Slower demand in Europa?

JP Morgan should check its facts. Until a couple of weeks back you could not order an Ipad2 here in Sweden. I had to wait almost 3 month for delivery from a non Apple store supplier.

Refurbished Ipad2 are sold at 95% of original price, since it is so hard to find an Ipad2.

With slowing economy, more cheap computers like Ipad2 will be sold.
post #62 of 105
Quote:
Originally Posted by iCarbon View Post

There is something deeply fishy with these reports.

A Shift from 17 to 13 million is a huge alteration -- and not the kind of screw-up we've ever seen from Tim Cook. I can only imagine two possible explanations:

1. the report is complete BS spread by someone selling AAPL short.
2. they actually will update the iPad this quarter... something I highly doubt (they rarely deviate from their product release cycle that much, and would gain little as the iPad 2 is still selling well).

It could simply be the impending world-wide double-dip recession -- combined with next year's release of an iPad3. Maybe Apple is foreseeing a sales dropoff as people rein in their wallets, and with an iPad3 coming out, Apple doesn't want get too much inventory built up.

I think the report may be overblown, but I do think there is a rational (non-apocalyptic) explanation for it, if it's true.
post #63 of 105
Less than a month ago, rumor sites reported that Apple increased their expected iPad 2 orders from 12 to 18. A new report says that the orders are dropping from 18 to 12.

Sounds to me like nothing changed.

Just some crap from people jerking Apples stock price around to get support for their puts and gets.
post #64 of 105
Quote:
Originally Posted by ConradJoe View Post

Unless they have a pricing theory which is different from every other manufacturing company on earth, they set their prices based on demand every single time for every single product.

They do have a different pricing theory, which is why they consistently have the highest profit margins in the industry. They cut prices for previous generations of technologies, or if lower component costs and economies of scale allows them to do so while maintaining margins.

"Premium" brands generally don't cut prices due to demand, otherwise they'd be in the same race-to-the-bottom as all their cheap competitors.
post #65 of 105
Quote:
Originally Posted by Dick Applebaum View Post

My point is that pricing is somewhat of a black art, and can be based on many things, including (but not limited to) demand.

Think about it!


Pricing theory is intended to answer the question: At what price will we maximize total profits?

Demand varies depending upon price. Could be a huge demand, even with a huge price. could be a tiny demand, no matter how low the price. That affects the curve. Normally, the higher the price, the lower the demand, and vice versa.

Without considering demand, normal pricing practices are not possible. There is a price/demand curve, which is carefully considered.
post #66 of 105
If others are anything like me, there is no decline in desire to buy an iPad 2. There is a decline in the ability of my wallet to pay for it, due to the sucky economy. A price reduction won't help.

So, yea, I guess there is a decline in "demand" (depending on how you define that term) - but not due to people not wanting the device, rather it's a money issue. I will buy one eventually, it's just going to take longer than it would have in a good economy.
post #67 of 105
duplicate
post #68 of 105
Quote:
Originally Posted by mytdave View Post


So, yea, I guess there is a decline in "demand" (depending on how you define that term) - but not due to people not wanting the device, rather it's a money issue.

The manner in which the word "demand" is used in pricing theory is in line with your guess. It is not the same as the word "desire".

For example, we might all "desire" an iPad2, but if it were priced at $10,000, "demand" would almost certainly be reduced, and if it were priced at $10, demand would almost certainly increase.
post #69 of 105
Quote:
Originally Posted by MacinScott View Post

... for Apple to add multiple users to the iPad.

Was hoping I'd finally see it with iOS 5 but I have my doubts.

Need to be able to log in and check my email, calendar, address book, iTunes playlists and Safari bookmarks and my wife needs to be able to do the same when she uses it. Same for guests.

I agree 100%. Other than having no cash right now, the lack of this one feature has kept me from buying an iPad. It's the one device I'd let the kids play with, but only if they had their own user account so I could prevent them from buying or deleting things, and screwing up the settings.
post #70 of 105
Quote:
Originally Posted by shawnb View Post

They do have a different pricing theory, which is why they consistently have the highest profit margins in the industry. They cut prices for previous generations of technologies, or if lower component costs and economies of scale allows them to do so while maintaining margins.

"Premium" brands generally don't cut prices due to demand, otherwise they'd be in the same race-to-the-bottom as all their cheap competitors.


Pretty much every company uses the same theory, which is that there exists a price point which will maximize total profits.

Premium brands realize that cutting prices will not maximize total profits, given the elasticity specific to the product in question. Crappy brands realize that raising prices will not maximize total profits, given the elasticity specific to the product in question.

Lower component costs do not result in lower selling prices unless the pricing change will maximize total profits. Your statement seems to depend on an assumption that a company will price things at a level lower than that which would maximize total profits, if, for example, the margin remains unchanged. Such a situation is rare, given that every company seeks to maximize total profits, and few would care that the margin is higher than it was prior to the cost reduction.

But if you disagree, tell me how Apple's theory is different from every other manufacturing company's. Do they not seek to maximize total profits?
post #71 of 105
Quote:
Originally Posted by iCarbon View Post

the iPad 2 is still selling well).

Apparently they sold between 7 and 9 million units in Q2 and analysts projected they'd sell 12-14m in Q3 but actually sold 9.25m:

http://www.apple.com/pr/library/2011...r-Results.html

So the analysts' expectations were just too high and in light of 9.25m sales, 13m seems a more reasonable number. Apple themselves may not have cut back anything but they easily could have if they themselves had higher projections.

Right now, the iPad is still an accessory device and requires computer ownership so has a limited market. After iOS 5, it can be given as a gift to elderly family members who may not own a computer or it can be used by some to finally replace a netbook. I expect iOS 5 will have a significant impact on Q4 sales.
post #72 of 105
Quote:
Originally Posted by ErosLWS View Post

... Personally, I haven't touched my iPad 2 in over 2 months; I'm hoping iOS 5 changes this.

Whose fault is that? It still does everything you bought it for to start with.
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post #73 of 105
Quote:
Originally Posted by jragosta View Post

How do you pump a stock by saying that their sales are declining?

Short and Distort I meant. AI should stop reporting on these scammers JP Morgan.
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post #74 of 105
Quote:
Originally Posted by jragosta View Post

How do you pump a stock by saying that their sales are declining?

It's called shorting AAPL and it's something these "analysts", who are nothing but stock manipulators, have been doing for years.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #75 of 105
Quote:
Originally Posted by Ireland View Post

Short and Distort I meant. AI should stop reporting on these scammers JP Morgan.

Actually, they should be investigated by the SEC.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #76 of 105
Quote:
Originally Posted by shen View Post

I barely use mine at all, in fact only on saturdays...

...because M-F my wife has it. I only get it saturday 'cause i tech an early morning class that day and I can leave with it while she is still asleep.

Feel free to send yours to me. I will give it a good home where it is loved.

I also have a home open to unloved iPads. I use mind way to much.
post #77 of 105
Quote:
Originally Posted by mr O View Post

It doesn't make sense to me. Why would Apple cut the price of their iPad AND lower the number of units being produced That feels like a sellout?

Have you actually seen a lower prices on iPad? If there was any truth to that part of the message we would obviously see it.

As to volume I wouldn't be surprised at all if there is a shift, but remember none of these numbers thrown about are confirmed. The biggest reason for a shift would be the European melt down which is real.
Quote:
I think iOS 5 will make the iPad sexy again. It will make the Post PC era truly happen (there will be no need to connect your iPad/iPhone/iPod (touch) to a computer ever again. Having said that, I am looking forward to the new iPod concepts.

IPods are another thing to consider, they may have a Touch replacement or an additional model coming that might impact iPad sales. Realize this is all speculation based on numbers with no solid grounding. I'm certain we will learn more as time goes on ( a couple of weeks). I still don't think we are out of the woods on changes to the iPad line up either.
post #78 of 105
Quote:
Originally Posted by wshuff4 View Post

If the price is really going down, I imagine it is because they know I recently bought one.

lol!
post #79 of 105
For many people the iPad is a better device to have if the economy is tight. Especially with the arrival of iOS 5 and the weaning fro the tether. If money is tight but yet you need to keep connected then iPad is a good choice. There is really nothing like it for quick connection to networks (WiFi) and travel.

Quote:
Originally Posted by eksodos View Post

Amazes me people think reports like this couldn't possibly credible. Europe is turmoil with consumer confidence falling through the floor. Do you think when people are worrying about debt, job security and making ends meet they are going to continue blowing money on high-end luxury products like the iPad and iPhone? The US is in awful shape too with consumers also feeling the pinch and confidence way down. So many people are cutting back on their spending, I believe it's impossible for Apple not take a hit from all this turmoil.

Anyone buying or holding onto Apple shares at current prices is a hell of lot braver than I am.
post #80 of 105
Thanks for the rumor, Samsung.
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