Apple's Tim Cook says increasing pace of 'iPhone 8' leaks hurting sales

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in iPhone
Some of Apple's problems with iPhone sales can be traced to more rapid leaks posted on news sites, CEO Tim Cook claimed during a quarterly results call on Tuesday.




"Earlier and much more frequent reports about future iPhones" are having an impact, Cook said in response to an analyst question. The executive didn't go into further detail.

Product rumors have been a factor in Apple sales for years, particularly with devices updated in annual cycles like the iPhone and iPad. People shopping for a smartphone in July, for instance, might consider holding off if a significant iPhone update is predicted for September. Hints of a modest update can prompt people to wait even longer, or simply buy an Android phone.

The issue may be exacerbated this year because of the alleged scale of Apple's plans. The "iPhone 8" is expected to be a major redesign, with a 5.8-inch OLED screen, a virtual home button, wireless charging, and 3D facial recognition and/or iris scanning.

Associated rumors go back as far as 2015 and have only intensified in recent months as the company approaches a crucial summer deadline for mass production. Supposed schematics and manufacturing molds may even be offering a glimpse at the product's final design, such as its vertically-aligned dual-lens camera.

In March-quarter results announced on Tuesday, iPhone sales fell year-over-year from 51.2 million to 50.8 million. It could be that the public sees the iPhone 7 as an "evolutionary" update like the iPhone 6s, making the "8" more attractive.
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Comments

  • Reply 1 of 49
    SoliSoli Posts: 9,270member
    But Sog told us that Apple is the one that is responsible for all the leaks. So is Sog or Cook lying?
    andrewj5790repressthisrandominternetpersonStrangeDaysmagman1979Nameo_tmay
  • Reply 2 of 49
    kevin keekevin kee Posts: 1,076member
    It's been common practice now for people to hold off buying any new iPhones if a new iPhone with new design is coming soon. That news media have been busy bombarding us with "unconfirmed" leaks certainly help the hold off. The problem is people who need to replace their phone now but don't will create:
    1. sales delay when everyone buying at the same time
    2. less sales of the current iPhone
    3. going for alternative (Samsung) when they can't get the new iPhone or when they read "negative" reviews from bias critics.
    hmurchisonwatto_cobra
  • Reply 3 of 49
    My wife needs a new iPhone7 - but wants the dual camera SLR effects in the smaller iPhone. Since all the rumors are showing a two camera layout for the next one, she's waiting...
  • Reply 4 of 49
    lkrupplkrupp Posts: 7,311member
    Soli said:
    But Sog told us that Apple is the one that is responsible for all the leaks. So is Sog or Cook lying?
    Ummmm, errrr, let me think...   Sog
    andrewj5790repressthisjony0magman1979Nameo_watto_cobra
  • Reply 5 of 49
    hmurchisonhmurchison Posts: 12,278member
    Come'on Tim 

    Anyone that owns or has owned and iPhone knows new phones are coming in the fall.   Sales are always going to drop but in 
    particular when we know a new form factor is coming.   I almost upgraded my 6s to a 7 and then said "I may as well wait for the 8" 


    radarthekatgatorguy
  • Reply 6 of 49
    lkrupplkrupp Posts: 7,311member
    It’s a problem. If Apple pre-announces that a new product is on the way or that they are working on something sales of existing products could suffer. By keeping things close to the vest they let the rumor mill run wild and sales of existing products could suffer. I remember Microsoft’s tactic. After a startup announced or released a new product Microsoft would immediately announce that they were working on the same thing and that it would be better. Consumers then often waited for the Microsoft product instead of buying the startup’s product. Microsoft would then buy out the now failing startup and release the original product as its own. Evil personified but it worked for a long time, along with the equally evil “embrace and extend” policy that suffocated innovative software.
    calijony0radarthekat[Deleted User]2old4funwatto_cobra
  • Reply 7 of 49
    lkrupplkrupp Posts: 7,311member
    People shopping for a smartphone in July, for instance, might consider holding off if a significant iPhone update is predicted for September. Hints of a modest update can prompt people to wait even longer, or simply buy an Android phone.
    I seriously doubt the people would “buy an Android phone” because they didn’t want to wait for Apple. That’s strictly a nerd sort of mentality.
    edited May 2017 calijony0cornchipdewmemagman1979gatorguy2old4funwatto_cobra
  • Reply 8 of 49
    asdasdasdasd Posts: 5,323member
    It's not that much of a problem. 50 M would have been a blowout Q a few years ago, their sell through was up y-y and we know there's a super cycle on the way. 
    radarthekatwatto_cobra
  • Reply 9 of 49
    chasmchasm Posts: 1,667member
    Soli said:
    But Sog told us that Apple is the one that is responsible for all the leaks. So is Sog or Cook lying?
    Tim Cook is under a legal obligation to stick to truthful or forward-looking statements only on those analyst calls. Sog is an anonymous commenter on an Apple forum. You decide.
    andrewj5790jony0cornchipradarthekat2old4funjbdragonwatto_cobra
  • Reply 10 of 49
    chasmchasm Posts: 1,667member
    It's also worth noting that if you deduct the difference in channel reduction from the year-ago quarter and this one, Apple actually sold slightly MORE iPhones this quarter than a year ago. The 50.8M figure only represents shipments to resellers; the total sell-through, Cook said, was quite a bit higher.
    cornchipradarthekat2old4funpalomineflaneurwatto_cobra
  • Reply 11 of 49
    asdasdasdasd Posts: 5,323member
    chasm said:
    It's also worth noting that if you deduct the difference in channel reduction from the year-ago quarter and this one, Apple actually sold slightly MORE iPhones this quarter than a year ago. The 50.8M figure only represents shipments to resellers; the total sell-through, Cook said, was quite a bit higher.
    Well about 1M higher. 

    So nothing to worry about.  
    radarthekatwatto_cobra
  • Reply 12 of 49
    kamiltonkamilton Posts: 262member
    Sog no lie
    repressthiscornchipradarthekatwatto_cobra
  • Reply 13 of 49
    EsquireCatsEsquireCats Posts: 639member
    There is historical precedent to Cook's claims (i.e. it's not just fluffy B/S to explain away the small dip in numbers.)

    It's called the Osborne effect, and it could explain an even larger dip than the current decline.
    Those old enough to remember the Osborne computer company may remember how their downfall was assisted, not just by competition disruption, but by dealers cancelling their orders for the current generation computer after having the next-generation model pre-promoted to them.

    Hence it's also a logical conclusion - if the next generation product is revealed to be a significant upgrade (instead of just being the more modest -S changes), then consumers will naturally hold back their purchases. The difference is waiting a few months, instead of more than a year.

    Certainly there may be other contributory reasons, such as the product maturity and competitors producing visually similar devices - but those would be minor factors by comparison. The growing ASP of the device could be an indication of the above, or a byproduct of long-held resistance from countries such as India and Indonesia. (However the SE model is due for sale on both of these countries soon, so we're likely to see an uptick again.)

    radarthekateightzerowatto_cobra
  • Reply 14 of 49
    freeperfreeper Posts: 77member
    lkrupp said:
    People shopping for a smartphone in July, for instance, might consider holding off if a significant iPhone update is predicted for September. Hints of a modest update can prompt people to wait even longer, or simply buy an Android phone.
    I seriously doubt the people would “buy an Android phone” because they didn’t want to wait for Apple. That’s strictly a nerd sort of mentality.
    Except that surveys and polls have shown that people do exactly that. Or a very recent example of the reverse behavior: during the Note 7 debacle, lots of people who wanted to buy the Galaxy Note 7 bought iPhones instead, and lots of THOSE are either buying the Samsung Galaxy 8+ or are waiting on the Galaxy Note 8. Two things that you are overlooking: 1) Carriers make it VERY EASY for their longtime customers to switch/upgrade devices. The reason is that it prevents the competition (carriers I mean) from using the lure of a new device to get people to switch. 2) 90% of the population doesn't care about the fanboy platform wars. Most people switch back and forth between the platforms. The vast majority of iPhone owners have owned an Android phone in the past and vice versa. The media only reports the number of people who switch from Android to iPhone each quarter ... while ignoring that an equal number of people switch from iPhone to Android, and that a huge number of people own BOTH iPhones and Androids with one being their daily driver and the other a spare, or one being for professional use and the other for personal use. That is why I always take the "I once owned a Samsung and LG phone and it was so horrible ... the stutter, the lag, the crashing apps ... it was a total nightmare but when I switched to an iPhone it was like a new lease on life!" comments on Apple blogs with a grain of salt (because anonymous unverifiable Internet comments that can be made with no repercussions are exactly that). It does not come close to matching actual market statistics and patterns. If it did you WOULD NOT see AT&T, Verizon, Sprint and T-Mobile treat iPhones and major Android phones nearly equally. (This was not always the case by the way ... I remember when Android phones were a distinct stepchildren to the iPhone and Nokia phones to carriers, and also when carriers were quite antagonistic to Google.) So as the average consumer hasn't been a loyal Apple fan who has only bought Apple products for the past 20 years but is instead someone who owned an Android phone 3 years ago before buying an iPhone 2 years ago - or vice versa - getting a Samsung Galaxy to use for 6 months or so until they can switch to an iPhone at the cost of only like $50 - $100 bucks (or even for free) from their carrier is not exactly a nausea-inducing thought, but rather is a routine business transaction for your very friends and neighbors.
  • Reply 15 of 49
    rogifan_newrogifan_new Posts: 4,193member
    This will keep the stock down tomorrow. All Wall Street cares about is iPhone sales and Cook just admitted they are sluggish.
  • Reply 16 of 49
    karmadavekarmadave Posts: 323member
    I think iPhone 8 leaks are only part of the picture. Other causes include: 1. A maturing market for smartphones 2. Fewer perceived innovations to the iPhone and iOS 3. Few apps that tax the capabilities of the current products I am hopefully that the 'iPhone 8' will give me reason to upgrade my iPhone 6, but if it's not truly innovative then I will stick with my trusty device :D
    palomine
  • Reply 17 of 49

    I think this is a result of Apple's decision of creating a new form factor period from every two year to every three year. 

    Personally I was less excited about iPhone 7 introduction compared to iPhone 6's. Even though spec wise iPhone 7 is a superior phone, design wise it looks just as good iPhone 6 not superior.


    I am not convinced the explanation about people buys android phones because of the rumors. I believe those people are in minority and they just want to have the latest not the greatest phone.


    I was very excited to watch samsung's s8's introduction because of the design but it didn't make me buy one of them. That phone is not a complete product. The biggest issue is aspect ratio of its screen. Most of the youtube videos cannot take advantage of the screen without sacrificing top and bottom crops.


    I will wait for the new design of iPhone 8 to upgrade my iPhone 6.

    watto_cobra
  • Reply 18 of 49
    freeperfreeper Posts: 77member
    People are holding off on buying the iterative update because they are waiting on the major redesign. Happens all the time - and not just with the iPhone or even just with Apple - so no news or shock here. It is only an issue for those who felt that iPhone sales were going to increase indefinitely. Everyone else - including folks internally at Apple - knew that the saturation point was going to happen some time. That was why 2 years ago Apple started making a concerted effort to get Android owners to switch - by playing up security and privacy fears and releasing the "move to iPhone" app - as well as focusing on overseas growth. But peak iPhone - more accurately peak (premium) smartphone - has passed. It may be an exaggeration to say that smartphones are just another product - as they still make Apple the #1 company in history by far after all - but the gee whiz phenomenon factor is gone. People are used to them, which means that they no longer have to go out and have the latest one ... or even get the best one that they can afford (since cheaper smartphones are no longer the brutal devices that they once were ... and by the way now include the iPhone SE, another attempt by Apple to goose sales and draw international customers and Android switchers).
    avon b7
  • Reply 19 of 49
    By how much do leaks hurt sales? Are we talking 1M or 2M unit losses? Surely, most consumers around the world aren't constantly reading tech articles about coming products. Since there are people always claiming that iPhone upgrades aren't worth very much due to lack of innovation, one would think there weren't a lot of people desperately waiting to upgrade. Again, we're talking about quarterly sales when investors should consider looking at the entire yearly sales. Between peak iPhone sales, Apple should be selling their other products to fill in those low revenue quarters. That's Apple's fault. If Apple had a cloud business it might have been able to fill in these low-revenue quarters.

    That's the difference between Apple and those FANG stocks. Those FANG stocks have revenue coming in every quarter and they're also managing to increase revenue every quarter whereas Apple has weak quarters because they're only relying on the iPhone. There doesn't seem to be any other major bright spots for Apple except the iPhone. With all that reserve cash, Apple should easily be able to find some business that can boost revenue every quarter.  Apple simply isn't aggressive enough or hungry enough as a company when they certainly have the means to be.
    edited May 2017
  • Reply 20 of 49
    lkrupp said:
    People shopping for a smartphone in July, for instance, might consider holding off if a significant iPhone update is predicted for September. Hints of a modest update can prompt people to wait even longer, or simply buy an Android phone.
    I seriously doubt the people would “buy an Android phone” because they didn’t want to wait for Apple. That’s strictly a nerd sort of mentality.
    I also doubt most consumers are going to buy an Android smartphone if they have to wait for an iPhone especially if they already own an iPhone.  Do average smartphone users really want to have to switch platforms because they might have wait a month or two.
    watto_cobra
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