November iPhone sales may be down 20 percent year-on-year, with iPhone XR as the top selle...

AppleInsider

The sales of iPhones went down in November by a fifth compared to 2017, according to sales estimates from Counterpoint, but while the iPhone XR is said to have become Apple's most popular currently-sold model, it hasn't reached the same volume of sales as the iPhone X in the same period the previous year.

iPhone XR in blue

The iPhone XR outsold both the iPhone XS and iPhone XS Max in November, the Counterpoint model tracker service advises, with the iPhone XR 64GB model being the most popular option in the month. Despite the promising sales, the iPhone XR has not only failed to reach the same level of popularity as the iPhone X, but also lags behind the iPhone 8's November 2017 figures by approximately 5 percent.

The iPhone XS, by comparison, is up 3 percent year-on-year compared to the iPhone 8 Plus, while the battle of the most-expensive models of each year has the iPhone X in 2017 beating the iPhone XS Max of 2018 by 46 percent. It is noted that cumulative sales of the iPhone XS Max was 50 percent higher by November 2018 compared to the iPhone X, as it was made available to purchase at an earlier time.

"We estimate iPhone XR to further eat into the share of higher-priced iPhone XS and XS Max during December 2018," advises Counterpoint.

Counterpoint's figures comparing the November 2018 iPhone sales with those from November 2017

Counterpoint's suggestion is similar to that of other analysts, such as Ming-Chi Kuo. In a December note to investors, Kuo trimmed his prediction of iPhone sales in the first quarter of 2019 to between 38 million and 42 million units, an effective year-on-year reduction for the period of between 16 percent and 24 percent.

Historically, Counterpoint has been pessimistic on sales and shipments relating to Apple, with the actual results as reported by Apple coming in higher than the suggested figures. There will be no comparison figure supplied by Apple for the holiday quarter, however.

According to Counterpoint, the sales for the 2018 models took a hit in November due to slower sales in the Asia Pacific region, the United States, and Europe. The declines in the U.S. and Europe are put down to lengthening replacement cycles combined with a decrease in operator discounts during the iPhone launch period, while the Asia Pacific sales excluding China and India are said to be due to the relatively high price of the iPhones compared to alternatives offered by Chinese smartphone vendors.

For China specifically, sales were said to be steady due to the popularity of 11.11 or "Single's Day" sales. However, sales of the iPhone XR remained lower than expected due to "a lack of innovative features and just one camera," as well as the fact that, while it is the cheapest new iPhone, it is "still expensive compared to local competitor products."

Reduced iPhone sales for the market is also due to the ongoing trade tensions between the United States and China, which has resulted in companies urging employees to boycott of Apple products and to buy from Chinese brands in retaliation.

In advising reduced revenue guidance to investors on January 2, Apple CEO Tim Cook highlighted underwhelming sales in China accounting "for all of our revenue shortfall," with weak iPhone upgrades and other "macroeconomic challenges" being cites as reasons for the financial misstep.

On January 7, U.S. Commerce Secretary Wilbur Ross advised Apple's revenue expectations were not due to trade tensions between the two countries, expressing "I don't think Apple's earnings miss had anything to do with the present trade talks."

Counterpoint also expects an increase in sales of older iPhone models in emerging markets, including the iPhone 7 and iPhone 8, due to the high pricing of newer models.

johnnybtrue

Yes, December information might be interesting.  Facts are nice.

wood1208

I understand more consumers choosing to buy default 64GB iPhone XR model but I thought for extra $50, 128GB XR would have been best selling. 

avon b7

wood1208 said:

I understand more consumers choosing to buy default 64GB iPhone XR model but I thought for extra $50, 128GB XR would have been best selling. 

It depends on the market. In Spain the difference between 64GB and 128GB is 60€.

The problem is that the 64GB model is already out of reach (859€) for many. Opting for 128GB means rising to 919€ which will mostly get a flat out 'no sale' for almost everyone I know (for the hardware on offer).

ElCapitan

avon b7 said:

wood1208 said:

I understand more consumers choosing to buy default 64GB iPhone XR model but I thought for extra $50, 128GB XR would have been best selling. 

It depends on the market. In Spain the difference between 64GB and 128GB is 60€.

The problem is that the 64GB model is already out if reach (859€) for many. Opting for 128GB means rising to 919€ which will mostly get a flat out no sale for almost everyone I know (for the hardware on offer).

You are right; they have largely priced themselves out of many international markets. 

78Bandit

wood1208 said:

I understand more consumers choosing to buy default 64GB iPhone XR model but I thought for extra $50, 128GB XR would have been best selling. 

My wife and I both got an XR in November.  Strangely enough there were very limited options in-stock for the 128GB model.  Our carrier had every color with 64GB but only Black & White in 128GB.  If you wanted a colored model the choice was either 64GB or wait for them to order what you wanted and ship it to your house.  I had wanted Product Red but wound up with black just for the memory.

eriamjh

I think Apple overshot the market tolerance for the maximum price of each model type by $150-250 US.  Most people probably would have accepted a $5-12/ month price increase, but not $20-30.  

exceptionhandler

I have usually recommended to friends and family to get the current model, but for the X and XS there’s no way I could justify the price tag.  Last year I told them to get a 7 or an 8, because the extra price is for not must haves.  I wanted to upgrade from my 7 this year, but opted for the battery replacement instead (before dec 31).  I also want a smaller phone, which is currently not offered.  Something like a 4.5-4.7” phone.  These 3 things are what have kept me from buying a new phone (price, size, cheap battery replacement).

hentaiboy

Counterpoint says that sales in China were “steady” after Cook stated publicly that they tanked. WTF?

gatorguy

hentaiboy said:

Counterpoint says that sales in China were “steady” after Cook stated publicly that they tanked. WTF?

Shipped is sold as far as that's concerned, so it's certainly possible that retailers/resellers did not order the additional iPhone stock for the holidays as they would have been expected to.  If consumer sales of existing iPhones already on hand were faltering a bit leading up to Black Friday then no need to purchase yet more shelf stock as they typically would in past years. 

IMO it's absolutely conceivable that the slide in sales was not recognized until the past 6 weeks. 

k2kw

eriamjh said:

I think Apple overshot the market tolerance for the maximum price of each model type by $150-250 US.  Most people probably would have accepted a $5-12/ month price increase, but not $20-30.  

The people who aren’t price sensitive will probably get an X,XS or XSMax.  If you are budget concerned you will probably look at XR iPhone and down.

chasm

Once again, from Cook's letter: "More than 100 percent of the shortfall is due to the Chinese economy contracting."

So no, the price of the iPhone (which is comparable to the premium offerings from Samsung) is not a factor. Consumer spending in China has contracted 70 percent in the last six months, according to Bloomberg. While there are probably other factors at play to blame for that, the trade war is definitely causing consumers and businesses in China to pull back on spending. Astute readers will have noticed that a wave of "bad earnings reports" have started coming in from all the tech businesses that depend heavily on the China market (like Samsung).

While we don't have data from most of the Chinese makers like Xiaomi yet, you can bet they'll seeing dramatic drops in sales as well.

Bottom line: Apple is firing on all cylinders and growing in every area -- except China sales. This is a relatively short-term problem (wait for trade war to end) rather than as some of you are suggesting, a long term problem (phone pricing). The proof can be found in sales everywhere outside of China. This is exactly why Apple abandoned the 90-day reporting cycle.

k2kw

ElCapitan said:

avon b7 said:

wood1208 said:

I understand more consumers choosing to buy default 64GB iPhone XR model but I thought for extra $50, 128GB XR would have been best selling. 

It depends on the market. In Spain the difference between 64GB and 128GB is 60€.

The problem is that the 64GB model is already out if reach (859€) for many. Opting for 128GB means rising to 919€ which will mostly get a flat out no sale for almost everyone I know (for the hardware on offer).

You are right; they have largely priced themselves out of many international markets. 

They definitely need to create a budget phone under $400.  Base it off of the 6S but with A9 chip manufactured in 10 nm.   If the lose someone to android they probably won’t get them back.

avon b7

chasm said:

Once again, from Cook's letter: "More than 100 percent of the shortfall is due to the Chinese economy contracting."

So no, the price of the iPhone (which is comparable to the premium offerings from Samsung) is not a factor. Consumer spending in China has contracted 70 percent in the last six months, according to Bloomberg. While there are probably other factors at play to blame for that, the trade war is definitely causing consumers and businesses in China to pull back on spending. Astute readers will have noticed that a wave of "bad earnings reports" have started coming in from all the tech businesses that depend heavily on the China market (like Samsung).

While we don't have data from most of the Chinese makers like Xiaomi yet, you can bet they'll seeing dramatic drops in sales as well.

Bottom line: Apple is firing on all cylinders and growing in every area -- except China sales. This is a relatively short-term problem (wait for trade war to end) rather than as some of you are suggesting, a long term problem (phone pricing). The proof can be found in sales everywhere outside of China. This is exactly why Apple abandoned the 90-day reporting cycle.

When consumers pull back on spending, price is definitely an important factor.

Apple's decision to raise prices (from refresh to refresh) has taken many people up to their price ceilings. With low consumer confidence, a lack of compelling innovation and with fierce competition all around (except for the US where Apple is largely immune to the competitive forces it faces elsewhere) things have taken a wobble.

As for Chinese companies, Huawei has stated it broke revenue records for 2018 as well as shipping over 200 million handset units. Awaiting fully audited results, it looks like they ended the year as strongly as they started.

https://www.phonearena.com/news/Huawei-smartphone-shipments-2018_id106773

https://www.engadget.com/2018/12/24/huawei-ships-record-200-million-phones/

https://www.fircroft.com/blogs/huawei-made-a-record-1085-billion-in-2018-93310473137

https://www.idc.com/getdoc.jsp?containerId=prUS44188018

schafdog

I still can't understand why Apple is ignoring the smaller PREMIUM (not cheap) phone segment. I want a one-hand device, that I can pocket. I don't want a phablet. Nobody is doing smaller preminum. It may not the biggest segment, but I still believe could 10% of the market. I have a iPhone SE but I would preferred a more expensive full featured. Perhaps the next should have same display size as an iPhone 8 but in X style.

n2itivguy

schafdog said:

Perhaps the next should have same display size as an iPhone 8 but in X style.

A slightly smaller XR wouldn’t be bad, though I like the current version matching the size of my previous 7+. 

yojimbo007

johnnybtrue said:

Yes, December information might be interesting.  Facts are nice.

Which facts? These are estimates(guesstimates) by a research company, not facts !

beowulfschmidt

k2kw said:

eriamjh said:

I think Apple overshot the market tolerance for the maximum price of each model type by $150-250 US.  Most people probably would have accepted a $5-12/ month price increase, but not $20-30.  

The people who aren’t price sensitive will probably get an X,XS or XSMax.  If you are budget concerned you will probably look at XR iPhone and down.

I can only speak for myself, but Apple certainly priced me out of the market for their new phones.  All of them, even the XR.  There is simply no feature so compelling to me (Not even FaceID, which I'd not be using for unlocking my phone anyway) that I feel the need to upgrade.  My 7 works, and works well.  Should it stop working, I'll consider my options at that time, but It seems likely that I'd simply opt for a new 7, or maybe an 8 or X, depending on how long my current one lasts.  Since the 4 was my immediate predecessor to my 7, I think I have some time.

gatorguy

I expect to see a plethora of articles, reviews, promotions, stories of how lives were saved and lives were changed, how new technology and new features are ready to make our lives more enjoyable and free-up more time for ourselves, better sex and a slimmer body, because "a new smartphone!"

There's so many players whose ongoing business benefits from we consumers continuing to overspend on being connected, (carriers, component makers, retailers, tech blogs, accessory lines to name a few) that we'll be fed a very heavy diet of "Whoa, that Camera!" and "Wow you need that screen!" and especially "5G... 5G...5G".  Everywhere.