Real world iPhone 6s adoption data contradicts Apple supplier channel check rumors

Posted:
in iPhone edited January 2016
The product mix of iPhone models in Apple's real world installed base of users shows smooth adoption of iPhone 6s models and no evidence of a decline in demand that would require unexpected production cuts. This publicly available data severely undercuts the supply chain rumors supporting a narrative of "Peak iPhone" and reactionary order slashing.


Source: Fiksu


Data reported by Boston-based mobile marketing firm Fiksu, which tracks usage analytics among the most popular 50 mobile apps including Facebook and Twitter (as noted by reader Jim Neil via Twitter), shows that iPhone 6s and 6s Plus have ramped up to account for more than 13 percent of the iPhone installed base within the first 100 days since their release.

That's less than the percentage attained by last year's iPhone 6 models at the same point (which had reached about 21 percent), but that's expected because the total installed base of iPhones this year is much greater. Over fiscal 2015, Apple sold over 231 million new iPhones, massively expanding the pool of iPhone users.

This year Apple's newest 6s models are selling next to last year's 6 models with a similar appearance at a $100 discount. However, the bulk of iPhones sold since the launch of iPhone 6s appear to be Apple's latest and newest model, as the growing adoption ratio of 6 and 6 Plus abruptly flattened out at the launch of iPhone 6s last fall. While the older 6/6 Plus models continued to sell, the increasing size of the installed base kept those earlier models' "percentage of all users" static.


Source: Fiksu


Since the 6s launch, the percentage of all iPhone users with a 6/6 Plus has actually gone down slightly, indicating that the increase in new 6s buyers is enough to obscure the smaller growth in new sales of last year's phone, even as the newest 6s/6s Plus models expanded their relative share by 13 percentage points.

There is zero indication that iPhone 6s models have tapered off or suddenly plunged; the data shows a smooth increase in sales since its launch.

As a percentage of the installed base, the iPhone 6s adoption ramp should be expected to be less than iPhone 6, due to the much larger size of today's installed base. However, the combined adoption of the new 6s and 6s Plus are consistently higher than the level seen in iPhone 5s two years (and 400 million iPhone sales) ago.

That indicates that as a premium priced model and a less obviously new "s" model version, the 6s family has incited more sales and switching than the earlier 5s model, which similarly competed against a $100 cheaper, previous generation of itself.

With the years of data Apple has on upgrade rates and switcher behaviors, this fails to support the idea that Apple was forced to dramatically shift its orders in response to slack demand for its new phone and instead indicates that Apple's 6s launch has been nothing but typical, and inline with Apple's previous performance.

On the other hand, iPhone 6 and 6s models combined have now reached about 55 percent of the iPhone installed base, essentially identical to the the proportion of users who had upgraded to either an iPhone 6 or 5s/5c model at this same point a year ago. That means that upgrade cycles have remained about the same despite the huge influx of new iPhone users, a metric that highlights the consistent cash machine tied to Apple's annual refresh cycle.

Android has slower adoption patterns



In stark contrast to the smooth annual upgrades among iPhone users, Fiksu's data on the Android installed base shows a much more chaotic and contentious rollout of flagship models, despite being dominated by one company. It also highlights the shrinking ratio of relevance of Samsung's primary premium flagship model among users.


Source: Fiksu


While the Galaxy 3 accounted for almost 19 percent of Android's installed base at the beginning of 2014 (a year and a half after it launched) in Fiksu's data, Samsung's Galaxy S4 successor only managed to grab just over 12 percent over the next year, and its Galaxy S5 hasn't yet reached 9 percent representation.

This indicates that Samsung's sales are much less cyclical than iPhones. Android users also appear be sticking with older models for much longer (or are more likely to buy older models), as usage data shows the adoption rate of the now three and a half year old Galaxy S3 remains currently tied with the S4 and S5.

Apple's ability to entice users to upgrade--and to choose its newest, most expensive models they do--is a primary reason why it now accounts for 94 percent of mobile industry profits.
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Comments

  • Reply 1 of 107
    SpamSandwichSpamSandwich Posts: 31,399member
    Reality is irrelevant. What matters is that analysts are in agreement and the stock is kicked to the curb.  /s
    palominelearningaboutAjahblade
  • Reply 2 of 107
    At a meeting on Wall St

    Guys, we are looking a bit short this month. Any Ideas how we can get our profits up? It is the end of our quarter and your bonus payments depend on it.

    All the Analyst come ou with the same answer.

    "Short Apple. Start a rumour about supply chain problems" said one
    "Nah! We did that last month."

    "Guys, go get a rumour about suppliers cutting production and laying off workers. Short Apple down to 99$."

    No one moved.

    "Well, what are you waiting for? Paint to dry?"


    palominetjwolf
  • Reply 3 of 107
    But Joe Blow analyst says his supply chains checks indicate a slow down and suppliers X, y and z say revenues are down so clearly that means no one is buying iPhones anymore. /s
  • Reply 4 of 107
    I can't believe the market continues to respond to these rumors, when Apple has said not to trust data points like these over the years. Not to mention, they've always proven completely false, so either financial analysts are manipulating the market to drive Apple share price down or they're just complete idiots. Crazy how so many people are expecting some big drop - like all of a sudden consumers say "gee, I don't like my iPhone, even though I used it more to buy products over the holidays - more than any other phone (not that it counts for anything).".
    radarthekat
  • Reply 5 of 107
    Isn’t it possible both reports are correct? If Apple is indeed launching a new iPhone 6c this winter, it would reflect an extremely prudent company to be cutting slightly down the supply chain of the regular versions in anticipation of 6c demand. 
  • Reply 6 of 107
    Slowing 6s sales won't show up till March and June quarter. Dec quarter iPhone 6s sales should match or beat 6 sales. All the supply chain reports are for phones sold in 2016.

    I think its time for people just to admit that iPhone units can't go up forever. We are at or very near peak iPhone. At max we have another 3-5 year of iPhone growth, unless Apple sells phones for a much lower price point.  So Apple really has only 2 choices if it wants to keep growing revenue. Either they need to lower the price of iPhones or they need to sell more services or do both.



  • Reply 7 of 107
    I can't believe the market continues to respond to these rumors, when Apple has said not to trust data points like these over the years. Not to mention, they've always proven completely false, so either financial analysts are manipulating the market to drive Apple share price down or they're just complete idiots. Crazy how so many people are expecting some big drop - like all of a sudden consumers say "gee, I don't like my iPhone, even though I used it more to buy products over the holidays - more than any other phone (not that it counts for anything).".
    Its not about holiday sales. Its about sales in March and June quarter. That is where the supply chain is showing a drop in unit sales.
  • Reply 8 of 107
    adrayvenadrayven Posts: 460member
    I can't believe the market continues to respond to these rumors, when Apple has said not to trust data points like these over the years. Not to mention, they've always proven completely false, so either financial analysts are manipulating the market to drive Apple share price down or they're just complete idiots. Crazy how so many people are expecting some big drop - like all of a sudden consumers say "gee, I don't like my iPhone, even though I used it more to buy products over the holidays - more than any other phone (not that it counts for anything).".
    Its not about holiday sales. Its about sales in March and June quarter. That is where the supply chain is showing a drop in unit sales.
    Which happened last year, and the year before that, and the year before that.. They always slow down this time of year. iPhone sales have been a seasonal product when it comes to volume for years now. The only real reason for the stock dropping this much is China and it's multiple market crashes this week has made WS very very skittish. Nearly everything in the market is down AT LEAST 5% right now for 2016.
    edited January 2016
  • Reply 9 of 107
    The absence of evidence is evidence of iPhone's imminent DOOM. It's time for Apple fans to admit the iPhone is over. No iPhone 6c or iPhone 7 model will save it.
    nolamacguy
  • Reply 10 of 107
    adrayven said:

    Which happened last year, and the year before that, and the year before that.. They always slow down this time of year. iPhone sales have been a seasonal product when it comes to volume for years now. The only real reason for the stock dropping this much is China and it's multiple market crashes this week has made WS very very skittish. Nearly everything in the market is down AT LEAST 5% right now for 2016.
    Yes iPhone sales slow down from Dec to March quarter. But these supply chain reports are comparing last years March quarter to this year.

    Yes all the stocks are down about 5% this week. But Apple was also down 22% the last few months in 2016. If Apple was still at $130 and it dropped to $123 that would not be too bad. But it has been under performing the entire market since Feb2015.
  • Reply 11 of 107

    The absence of evidence is evidence of iPhone's imminent DOOM. It's time for Apple fans to admit the iPhone is over. No iPhone 6c or iPhone 7 model will save it.
    Lack of evidence? The evidence is piling up. There are a ton of supply chain reports and weak earnings by iPhone suppliers. Did we even have one single iPhone supplier who showed the strong earnings yet? 

    There is just way too much smoke for their not to be a fire. But this fire is temporary. Get your wallets ready for $80 per share and buy up big time. Once the dust settles and iPhone 7 comes out we will see 10% sales growth again and $125 stock price. IMO, that is the easiest way to make 50% return in less than a year.
    jackansi
  • Reply 12 of 107
    lkrupplkrupp Posts: 7,310member
    F.U.D. is driving the whole market down. Apple is not in this predicament by itself you know.
    magman1979
  • Reply 13 of 107
    Slowing 6s sales won't show up till March and June quarter. Dec quarter iPhone 6s sales should match or beat 6 sales. All the supply chain reports are for phones sold in 2016.

    I think its time for people just to admit that iPhone units can't go up forever. We are at or very near peak iPhone. At max we have another 3-5 year of iPhone growth, unless Apple sells phones for a much lower price point.  So Apple really has only 2 choices if it wants to keep growing revenue. Either they need to lower the price of iPhones or they need to sell more services or do both.



    Is it OK with you if I wait for the quarterly report before I admit to the end of iPhone growth?  Analysts read these tea leaves every year, and yeah, like a broken clock they'll no doubt be accurate some time in the future.  But this time?  I'll wait to hear it from the horse's mouth.  Too many unethical manipulators, as described in the Slingshot Theory of AAPL manipulation:   http://fortune.com/2012/10/08/meet-one-of-the-guys-tugging-on-the-apple-slingshot/

    I'm not saying you're an unethical manipulator, but you don't have any significant history in AI and you're encouraging us to sell.  If you're not a manipulator, at the very least your behavior is consistent with being one.

    palomine
  • Reply 14 of 107
    Interesting part of this graph is that about 35% of iPhone users have not upgraded to iPhone6 or 6s. 

    What are they waiting for?

    Are over 100,000,000 current iPhone users waiting for a 4 inch phone? I don't get it.
  • Reply 15 of 107




    ... There is zero indication that iPhone 6s models have tapered off or suddenly plunged; the data shows a smooth increase in sales since its launch. ...
    Even though I agree with the thrust of the article, this statement above is clearly false.  The chart within the article clearly shows (an admittedly small) "levelling off" of sales in the most recent weeks.  Not only that, the same little plateau is not evident in the data for any of the other models shown.  It's small, but strong enough to question the veracity of the title of the article itself.  

    It would be nice if the author merely talked about the data instead of imposing a view on us that the data doesn't really support.  

    Love that graph though.  Very attractive.    :)
    I would love to see an animated version of this going all the way back to 2007 with the rise and fall of all the phones in the 100% mix.  It would be awesome to watch. 
    edited January 2016
  • Reply 16 of 107
    mjtomlinmjtomlin Posts: 2,010member

    The absence of evidence is evidence of iPhone's imminent DOOM. It's time for Apple fans to admit the iPhone is over. No iPhone 6c or iPhone 7 model will save it.
    Lack of evidence? The evidence is piling up. There are a ton of supply chain reports and weak earnings by iPhone suppliers. Did we even have one single iPhone supplier who showed the strong earnings yet? 
    Rumors and conjecture are not evidence. Real evidence in this circumstance would be actual sales figures along with how many iPhones are still in the channel and how many Apple expects to sell in the following quarters.

    Apple could have asked for a 100 million iPhones in the Holiday quarter and got them. Then scaled back for post holiday and only ordered 50 million more. That's a 50% drop but it does not represent any factual data that sales have dropped year over year, if even the March quarter orders are smaller.

    Last year the iPhone 6 Plus was severely constrained, which would mean the amount of orders placed by Apple with their suppliers would've remained consistent for a longer period until demand was met. That didn't happen this year. Apple had enough of all models to allow immediate shipment.

    Looking only on the surface for signs is moronic. The truth is hidden much deeper especially when dealing with supply chain logistics from suppliers that are forced to sign NDAs. All the reports about suppliers dropping YoY could simply be that Apple switched suppliers or cut orders from them after adding another supplier.
    palominenolamacguyjax44
  • Reply 17 of 107
    rob53rob53 Posts: 2,086member
    Slowing 6s sales won't show up till March and June quarter. Dec quarter iPhone 6s sales should match or beat 6 sales. All the supply chain reports are for phones sold in 2016.

    I think its time for people just to admit that iPhone units can't go up forever. We are at or very near peak iPhone. At max we have another 3-5 year of iPhone growth, unless Apple sells phones for a much lower price point.  So Apple really has only 2 choices if it wants to keep growing revenue. Either they need to lower the price of iPhones or they need to sell more services or do both.
    Why do you think that? It's obvious you don't understand Apple of the people who buy Apple products. Sure, everyone would like prices to go down on everything but the majority of Apple buyers understand that they're getting value for their money. The majority of Android phones are either given away or sold very cheaply because they are cheap, contrary to what some Android phone buyers say. There will be several new generations of iPhone buyers before the next type of product is introduced. Also, what's the problem with the amount of revenue they're making right now? The majority of mobile device manufacturers and resellers are making next to nothing. Apple is the only company that makes any appreciable profit. The problem with AAPL is that there's too much manipulation going on. It's like casinos fixing every game. The house always wins and the Stock Market is the house. Apple the company is doing great and I bet really couldn't care less about the stock market.
    delreyjonespalominenolamacguy
  • Reply 18 of 107
    levilevi Posts: 344member
    These articles and accompany data are encouraging. Guess we'll know the truth soon enough. Either way, I'll remain long AAPL. They generate so much revenue, from so different sources, many of which are still in the early stages of the product cycle. Cut pig in sales in half, and still have a company larger than every other tech company. And that's far from a bad position. 

    On an unrelated note, look at what happened to Fitbit this week - down over 25%. Damn. Maybe they should've  announce plans to release no new products. 
    delreyjonespalomine
  • Reply 19 of 107
    levilevi Posts: 344member
    levi said:
    These articles and accompany data are encouraging. Guess we'll know the truth soon enough. Either way, I'll remain long AAPL. They generate so much revenue, from so different sources, many of which are still in the early stages of the product cycle. Cut pig in sales in half, and still have a company larger than every other tech company. And that's far from a bad position. 

    On an unrelated note, look at what happened to Fitbit this week - down over 25%. Damn. Maybe they should've  announce plans to release no new products. 
    Referring to iPhone sales, not pig sales. Though those could fall flat to, and I wouldn't worry :-)
    jax44
  • Reply 20 of 107
    tmaytmay Posts: 3,944member
    Slowing 6s sales won't show up till March and June quarter. Dec quarter iPhone 6s sales should match or beat 6 sales. All the supply chain reports are for phones sold in 2016.

    I think its time for people just to admit that iPhone units can't go up forever. We are at or very near peak iPhone. At max we have another 3-5 year of iPhone growth, unless Apple sells phones for a much lower price point.  So Apple really has only 2 choices if it wants to keep growing revenue. Either they need to lower the price of iPhones or they need to sell more services or do both.



    Is it OK with you if I wait for the quarterly report before I admit to the end of iPhone growth?  Analysts read these tea leaves every year, and yeah, like a broken clock they'll no doubt be accurate some time in the future.  But this time?  I'll wait to hear it from the horse's mouth.  Too many unethical manipulators, as described in the Slingshot Theory of AAPL manipulation:   http://fortune.com/2012/10/08/meet-one-of-the-guys-tugging-on-the-apple-slingshot/

    I'm not saying you're an unethical manipulator, but you don't have any significant history in AI and you're encouraging us to sell.  If you're not a manipulator, at the very least your behavior is consistent with being one.

    Wall Street works overtime to get (deadbeat*) stockholders to panic and dump long term holdings.

    Can't gamble in the Casino without convincing the mark to bring his life savings.

    *Deadbeat
    A "deadbeat" is the unflattering term sometimes used in the credit card industry to describe consumers who pay off their balances every month, using the lenders' money but paying no interest on it. The more-polite, official term is "transactor." Since the recession's end, deadbeats -- or transactors -- have been on the rise, since more consumers see the wisdom of using credit cards as a tool of convenience, not an instrument of debt.

    I'm assuming there is a similar term for stockholders sitting on their long term holdings, rather than playing in the Casino.

    delreyjones
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