The install base grew much more than 100,000,000 from Q4 2014 to Q4 2015. Apple sold about 230,000,000 iPhones during that period. Do you seriously think that 130,000,000 iPhones went offline during that same period?
Not offline but they upgraded (which does not expand the user base) so roughly 40% of iPhone sales are new users. This is also about the number that the Bernstein analyst stated in an CNBC interview recently. What have you seen as user base for dec14-15?
Still doesn't make sense.
You are saying the Apple install base increased by 100,000,000 from 2014 to 2015. Apple sold 230,000,000 iPhones in 2015. So are you telling me 130,000,000 iPhones got junked in 2015?
Not offline but they upgraded (which does not expand the user base) so roughly 40% of iPhone sales are new users. This is also about the number that the Bernstein analyst stated in an CNBC interview recently. What have you seen as user base for dec14-15?
Still doesn't make sense.
You are saying the Apple install base increased by 100,000,000 from 2014 to 2015. Apple sold 230,000,000 iPhones in 2015. So are you telling me 130,000,000 iPhones got junked in 2015?
I tried to explain above that those 130m are not new iphone user but upgraders to that does not expand the user base. It's unlikely that there were 231k new customers, it also does not jive with my earlier math and Bernstein analyst statement that 40% of iphone sales were new iphone users. Nevertheless, my math shows a 25% decline which intuitively seems way to low. Do you have numbers to reject this reasoning?
You are saying the Apple install base increased by 100,000,000 from 2014 to 2015. Apple sold 230,000,000 iPhones in 2015. So are you telling me 130,000,000 iPhones got junked in 2015?
I tried to explain above that those 130m are not new iphone user but upgraders to that does not expand the user base. It's unlikely that there were 231k new customers, it also does not jive with my earlier math and Bernstein analyst statement that 40% of iphone sales were new iphone users. Nevertheless, my math shows a 25% decline which intuitively seems way to low. Do you have numbers to reject this reasoning?
You are still not accounting for the iPhones that were traded in and bought by new users in the secondary market.
The only one who knows the true size of the iPhone install base is Apple. I wish they would disclose this during their quarterly calls.
When the iPhone first came out you could get it one way, with one SIM, in one color, and with 2 or 3 storage choices. Now there are still 3 storage choices, along with multiple SIMs for multiple carriers, and multiple case colors and multiple screen sizes. In addition, now that the iPhone is sold world wide, each box is printed in various languages and the iPhone is loaded with an iOS for the appropriate language.
If I'm not mistaken, only US iPhones are sold bundled with SIM cards. iPhones sold eleswhere/globally (which I would think is the majority) don't come with SIM cards, but a SIM ejector tool instead. But I concede to your points, re: multiple colours and screens.
As for the box, I think the back of each box is actually blank. Each batch (for a specific market/region) gets different stickers (with info on it) that are pasted onto the back of the iPhone box. Or if there isn't a sticker on the back, maybe the box is printed in English. At least that's how all the boxes I've ever seen look like.
And the iOS language thing is a non-issue. When you first turn it on, iPhone reads the SIM or IP address data to find out the region it's in. iOS automatically selects the right region and language once you 'slide to setup iPhone'.
You are saying the Apple install base increased by 100,000,000 from 2014 to 2015. Apple sold 230,000,000 iPhones in 2015. So are you telling me 130,000,000 iPhones got junked in 2015?
I tried to explain above that those 130m are not new iphone user but upgraders to that does not expand the user base. It's unlikely that there were 231k new customers, it also does not jive with my earlier math and Bernstein analyst statement that 40% of iphone sales were new iphone users. Nevertheless, my math shows a 25% decline which intuitively seems way to low. Do you have numbers to reject this reasoning?
Many phones are sold or passed on, so again that makes no sense. Probably no more than 40-50% are not used after the person bought a new one (Trade in or taken out of circulation).
There are actual estimation of the those exact numbers done by Forbes I think (If you google long enough you'll find them).
Phones can be: traded-in, sold, gifted, taken out of circulation, or reused by the original owner as a secondary device (ex as an Apple TV remote)
Only Trade-in and taken out of circulation/reused as secondary really means the phone is not used by a new person.
This seems like the Wall Street game, now that the Buyback Program began:
Plant some news, then Short it heavily, once the Blackout Period begins. Then, wait for Apple to buy back shares the next quarter, and the rinse/repeat once again, when Blackout starts the next quarter.
I did the math. It seems to me that at 100 days, the adoption rate, according to those graphs, was 13.0% vs 19.8% (not 21% as your article states). While from other source I gather that total install base has increased by 28%. Maybe I am mistaken and it is a whole huge 30% (wow!), let's assume 30%. Still, 13% of 130 = 16.9 , while 19.8% of 100 = 19.8. So the increased install base doesn't quite compensate (16.9<19.8). In fact to make your numbers work, we need to assume that iPhone install base increased by more than 50% in one year!
Could you please explain and possibly correct my back-of-the-napkin calculations, please. I am trying to figure out your argument. I am long AAPL and want to believe, but I also want to be forewarned if earning will be bad in 16FQ1.
Comments
You are saying the Apple install base increased by 100,000,000 from 2014 to 2015.
Apple sold 230,000,000 iPhones in 2015.
So are you telling me 130,000,000 iPhones got junked in 2015?
The only one who knows the true size of the iPhone install base is Apple. I wish they would disclose this during their quarterly calls.
As for the box, I think the back of each box is actually blank. Each batch (for a specific market/region) gets different stickers (with info on it) that are pasted onto the back of the iPhone box. Or if there isn't a sticker on the back, maybe the box is printed in English. At least that's how all the boxes I've ever seen look like.
And the iOS language thing is a non-issue. When you first turn it on, iPhone reads the SIM or IP address data to find out the region it's in. iOS automatically selects the right region and language once you 'slide to setup iPhone'.
Probably no more than 40-50% are not used after the person bought a new one (Trade in or taken out of circulation).
There are actual estimation of the those exact numbers done by Forbes I think (If you google long enough you'll find them).
Phones can be: traded-in, sold, gifted, taken out of circulation, or reused by the original owner as a secondary device (ex as an Apple TV remote)
Only Trade-in and taken out of circulation/reused as secondary really means the phone is not used by a new person.
Plant some news, then Short it heavily, once the Blackout Period begins. Then, wait for Apple to buy back shares the next quarter, and the rinse/repeat once again, when Blackout starts the next quarter.
Like shooting ducks in a barrel.