As iPad sales decline, Apple remains bullish on future of tablet market

Posted:
in iPad edited August 2014
Though iPad sales have fallen two quarters in a row, Apple Chief Executive Tim Cook said on Tuesday he isn't concerned, and teased that his company is working on new innovations that, along with the newly announced IBM partnership, could help reinvigorate growth.

iPad mini


Speaking to analysts and members of the media on Tuesday, Cook said that while iPad sales met Apple's internal expectations, he realized they were short of what many investors were hoping. Apple reported sales of 13.28 million iPads for the June quarter, a total that was off 9.2 percent year over year.

Cook said there were a number of reasons that iPad sales were down, including channel reduction and market softness in certain parts of the world, including the U.S. and Western Europe.

But the Apple CEO characterized himself as "very bullish about the future of the tablet market." Unsurprisingly, he didn't say where Apple might be looking to take the market, but he did tease that the company is planning innovations in hardware, software and services.

Cook also cited statistics that show Apple dominating the tablet market, and the fact that more than half of iPad buyers are purchasing their first tablet.

He also touted his company's newly announced partnership with IBM, which will see Big Blue helping to deploy and support iOS devices in the workplace. Combined with Apple's "legendary ease of use," he sees great opportunities for iPad growth in the enterprise.

"What's important to us is that customers are enjoying their iPads and using them heavily," Cook said.
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Comments

  • Reply 1 of 49
    Post concern for Apple's future below. ;)
  • Reply 2 of 49
    darklitedarklite Posts: 229member

    Is the drop in sales being picked up by other manufacturers, or does it seem to be a decline in the overall tablet market itself?

  • Reply 3 of 49
    e1618978e1618978 Posts: 6,075member

    Its pretty clear why the sales decline is happening, since more than half of buyers are new to the iPad.   People don't upgrade iPads much - the old ones are fine.



    I have an iPad 2, and see no reason to get a newer one.

  • Reply 4 of 49
    gatorguygatorguy Posts: 23,168member
    darklite wrote: »
    Is the drop in sales being picked up by other manufacturers, or does it seem to be a decline in the overall tablet market itself?

    The tablet category itself has been in recent decline according to stats. I have some ideas why
    http://forums.appleinsider.com/t/181515/apple-falls-short-of-expectations-with-7-7b-in-profit-on-sales-of-35-2m-iphones-13-3m-ipads/40#post_2567715

    http://www.pcworld.com/article/2452189/tablet-sales-dip-as-market-matures.html
  • Reply 5 of 49
    tallest skiltallest skil Posts: 43,399member
    Originally Posted by e1618978 View Post

    Its pretty clear why the sales decline is happening, since more than half of buyers are new to the iPad.   People don't upgrade iPads much - the old ones are fine.



    I have an iPad 2, and see no reason to get a newer one.




    I have a first gen. Don’t plan to upgrade until the 13/15” is released.

  • Reply 6 of 49
    The Retina display is more than a reason to upgrade from a first gen or iPad 2, IMO.

    Still, when the iPad 2 gets the axe sales will spike again. They should take the 3 out at the same time, it's not much faster.
  • Reply 7 of 49
    mj webmj web Posts: 918member
    Anecdotally, I bought a 128 GB iPad Air, my first tablet, last year. It primarily collects dust. iPad excels at presentations and as an aggregator of all my media files, but I prefer working on my iMac or surfing the web on my MB air. Obviously your mileage may vary and some people are hooked on tablets but I can personally understand why table sales are waning.
  • Reply 8 of 49
    smalmsmalm Posts: 671member
    Quote:
    Originally Posted by TheWhiteFalcon View Post



    The Retina display is more than a reason to upgrade from a first gen or iPad 2, IMO.

    But after the iPad 3 even the iPad Air, nice as it is, was not tempting enough to upgrade. Main reason was the lack of sufficent RAM.

  • Reply 9 of 49
    malomalo Posts: 19member
    Comparatively, the Y/Y numbers are solid, exception iPad sales. Nice setup going into Q4 with a transition into new product life cycles and new categories about to launch.

    All in all, the nose of this plane keeps pointing up and the Tim Cook era is really just starting.

    Happy Investor!
  • Reply 10 of 49
    mj web wrote: »
    Anecdotally, I bought a 128 GB iPad Air, my first tablet, last year. It primarily collects dust. iPad excels at presentations and as an aggregator of all my media files, but I prefer working on my iMac or surfing the web on my MB air. Obviously your mileage may vary and some people are hooked on tablets but I can personally understand why table sales are waning.

    Reverse is true for me: I use the Mac for work, and iPad for web surfing, shopping, reading ebooks, listening to music, playback of itunes media, streaming Netflix, journal writing, and playing iOS games.
  • Reply 11 of 49
    theothergeofftheothergeoff Posts: 2,081member
    Quote:

    Originally Posted by TheWhiteFalcon View Post



    The Retina display is more than a reason to upgrade from a first gen or iPad 2, IMO.



    Still, when the iPad 2 gets the axe sales will spike again. They should take the 3 out at the same time, it's not much faster.

    The 3 was axed already;-) It didn't live past the 4 (lightning).   My guess is the 3 will be 'unsupported' at the same time the 2 is.

     

    iPad sales will 're-ramp' when

    1) TouchID is embedded (turn off to lock, press to unlock... a key requirement for corporate types)

    2) a 12" or larger is shipped to meet corp/professional customer needs (those 14-15" laptops)

    3) in about 3 years, when all these schools/colleges/students matriculate their devices into next equipment.

    4) the next big network speed bump comes into play (LTE2, AC becomes common place)

    5) Continuity between mac and phone and pad become ubiquitous...  Where my 'state' is iclouded to all iDevices automagically.  (Why carry that laptop... everything I need is already on my iPad?)

    6) home automation has its 'aha' moment  (I'm seeing it now... I'm redoing my security system, and instead of 5 security panels, I'm putting in one master, and it's an iOS app everywhere else... my wife... she'll want an iPad dedicated to the task.

     

    at that point, people will have one iPad apiece, vs the 1 iPad per home.

     

    I do think the life span of a tablet will be 5 years, given the  no moving parts construction compared to a laptop (typically a 3(pc)-5(macbook) year lifespan), and the generally be treated much more nicely than a phone. 

     

    I also think that when you spend $500+ on something, you milk it a bit longer than a $199 device.  And coupled with the 'I don't want to learn another OS' people wedged into Window XP/7/8, it will take MS Surface's abject failure before they give up their Dell laptops.

  • Reply 12 of 49
    Reverse is true for me: I use the Mac for work, and iPad for web surfing, shopping, reading ebooks, listening to music, playback of itunes media, streaming Netflix, journal writing, and playing iOS games.

    Same. My MBA is just for when I need a keyboard, mainly with word processing. Or if I'm doing family history research, that works better on a larger screen. I keep my journal on my good old eMate 300.
  • Reply 13 of 49

    My wife had an iPad 1st gen, and only recently updated to the current model.  There wasn't enough useful capability (for her) added in each gen to be worth updating.  The old one slowing down on web browsing, stuck on IOS 5, and increasing incompatibility were stronger factors than a camera or other new capabilities.  So I expect it to be quite a while before we will be buying a new model.

  • Reply 14 of 49
    tallest skiltallest skil Posts: 43,399member
    Originally Posted by sog35 View Post

    With the rise of the Apple 5.5 phone the lines are blured.



    You mean the nonexistent thing that isn’t in any way a non-portable computing device?

  • Reply 15 of 49
    island hermitisland hermit Posts: 6,217member
    Quote:

    Originally Posted by Tallest Skil View Post

     



    I have a first gen. Don’t plan to upgrade until the 13/15” is released.


     

    Our first gen is finally almost toast. It really struggles on a lot of websites and apps lately. We're waiting to see what comes out in the fall.

  • Reply 16 of 49
    bergermeisterbergermeister Posts: 6,784member

    Has anyone done a study linking the device and the OS?  I wonder if the newest iPad sales are lower due to the installed OS.

     

     

    People aren't buying the device completely separately from the OS, so I assume there is some link.

     

    I have posted many times here about how I personally dislike iOS7 and can say for a fact that iOS7 kept me from buying an iPad Air.  If the Air ran iOS6 I would buy it.  Ditto for the wife.  That is two sales that were determined not by the device itself but by the OS.  If it's just the two of us, Apple won't care.  If it is a larger number, they will need to start considering things.

     

    I am primarily looking at the visual, UI appearance of the OS that for me make the OS hard to use (I do have it installed on an iPad mini, now a paper weight), not necessarily new functions that I would not have if it ran 6.

     

     

    iPad 1 & iPad 3, not interested in iOS7 and therefore any device that requires it.  iOS 8, well, I don't think they improved the appearance much so I doubt I will jump, even though there are some functions obviously that would make my life a lot easier.  If I can't get past the UI, an omniscient machine for just $2 wouldn't sell me.

  • Reply 17 of 49
    wizard69wizard69 Posts: 13,377member
    e1618978 wrote: »
    Its pretty clear why the sales decline is happening, since more than half of buyers are new to the iPad.   People don't upgrade iPads much - the old ones are fine.


    I have an iPad 2, and see no reason to get a newer one.

    There would be good reason if Apple addressed a few short comings with respect to iPad. I'm still rocking iPad 3 waiting for Apple to pull head from ass and deliver a proper update.
  • Reply 18 of 49
    bergermeisterbergermeister Posts: 6,784member
    Quote:

    Originally Posted by wizard69 View Post





    There would be good reason if Apple addressed a few short comings with respect to iPad. I'm still rocking iPad 3 waiting for Apple to pull head from ass and deliver a proper update.

     

    iPad 3 is great.  What updates would you consider "proper"?

  • Reply 19 of 49
    SpamSandwichSpamSandwich Posts: 33,408member
    Quote:

    Originally Posted by wizard69 View Post





    There would be good reason if Apple addressed a few short comings with respect to iPad. I'm still rocking iPad 3 waiting for Apple to pull head from ass and deliver a proper update.

     

    Get an iPad Air if you want a newer model...but you're really just trolling anyway.

  • Reply 20 of 49
    entropysentropys Posts: 3,107member
    Even heavy iPad users such a myself do not have a super compelling reason to upgrade yet.

    Sure you can tweak or add a few features but at the end of the day, it is a screen to run apps. Jobs' vision has been near perfectly executed.
    The minimalist design means that there isn't a significant difference in appearance between models. Shallow, but no doubt a true driver of many upgrades for things like iPods and phones.
    And an iPad 2 can still run a lot of apps that an iPad air can run.

    If Apple was really only market driven, they would do two things, firstly make new models obviously visually different from previous models, and add a stack more ram and encourage app builders to use it. Thus forcing people onto the upgrade path if they want to keep using apps.

    As you can see, I can do evil.
    Instead, they have effectively made the device itself invisible (thus long life), and encourage app builders to maximise the efficiency of RAM use. Good, good Apple.

    Of course the other thing they could do is more actively peruse PC replacement. Power, light weight, space, play very nicely in corporate environments, and dare I say it, access to file directories.
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