Apple expects 'iPhone 11' sales to match 2018 iPhone XS sales figures
Apple's suppliers are reportedly in the process of making 75 million of the September 2019 'iPhone 11' range, which is approximately the same as orders for the 2018 models.
That 75 million production order is approximately the same as it was for the 2018 family that included the iPhone XR, iPhone XS, and iPhone XS Max at launch. Apple is apparently anticipating that demand will remain steady, at least in the first few months, despite an overall fall in smartphone demand and the ongoing trade disputes between the US and China.
According to Bloomberg, suppliers in Asia are planning for 75 million devices, and to have the capacity to go to 80 million if required. The figures, from unnamed sources in the supply chain, are for all three of the expected new iPhone models.
Foxconn, in particular, is reported to be increasing its workforce in Shenzen. It is also believed to be paying staff around 10% more this year in order to ensure having enough people to make the devices.
That's despite Foxconn's founder urging Apple to move its iPhone production away from China over both rising labor costs and the US/China trade tensions.
The 75 million would only be for the launch period of the device, spanning September, October, and some of November. Apple provides estimated order quantities up front to device manufacturers, and adjusts them as device demand peaks and wanes, as well as tailoring them for consumer demand of a particular model.
That will be in part because of how sales of the iPhone have declined and also because of persistent rumors that the 2020 iPhones will feature major updates including 5G and possibly an iPad-style ProMotion display.
That 75 million production order is approximately the same as it was for the 2018 family that included the iPhone XR, iPhone XS, and iPhone XS Max at launch. Apple is apparently anticipating that demand will remain steady, at least in the first few months, despite an overall fall in smartphone demand and the ongoing trade disputes between the US and China.
According to Bloomberg, suppliers in Asia are planning for 75 million devices, and to have the capacity to go to 80 million if required. The figures, from unnamed sources in the supply chain, are for all three of the expected new iPhone models.
Foxconn, in particular, is reported to be increasing its workforce in Shenzen. It is also believed to be paying staff around 10% more this year in order to ensure having enough people to make the devices.
That's despite Foxconn's founder urging Apple to move its iPhone production away from China over both rising labor costs and the US/China trade tensions.
The 75 million would only be for the launch period of the device, spanning September, October, and some of November. Apple provides estimated order quantities up front to device manufacturers, and adjusts them as device demand peaks and wanes, as well as tailoring them for consumer demand of a particular model.
That will be in part because of how sales of the iPhone have declined and also because of persistent rumors that the 2020 iPhones will feature major updates including 5G and possibly an iPad-style ProMotion display.
Comments
A major redesign and 5G for 2020 will possibly act as a double whammy against the 2019 refresh.
There might even be a triple whammy if prices don't come down as those 2017 iPhone X purchasers who might be interested in upgrading this year (and have the money to do so) could eventually decide to wait until next year and squeeze even more out of their existing phone and the maximum possible out of the 2020 phone.
On top of that, I saw a (possibly dodgy) article yesterday about Apple's difficulties in China:
https://technode.com/2019/07/24/chinese-iphone-users-are-increasingly-opting-for-huawei-report/
For me though, price remains the number one drawback.
Funny, I thought you hated iOS, so maybe you aren't telling the full story. Seems like you have an agenda to push lower prices.
Oh, and that 75 million is just the initial order. I still expect Apple to need around 120 M of the new models over this model year, regardless of what is happening with Huawei.
https://edition.cnn.com/2019/07/23/tech/washington-post-huawei-north-korea/index.html
This is potentially very damaging to Huawei, and may be yet another cause to maintain the restrictions on sales of U.S. origin components to Huawei.
"Last month, the US president said he would ease some restrictions on Huawei, saying he would allow American firms to resume sales to Huawei of products that don't pose a security threat.
'For me' means 'in my opinion'. No idea where you got the 'I hate iOS' from.
Still, I will repeat: 75 million is pretty good all things considered. That was the key takeaway.
Huawei is being used as a political football, true, but it's not like they haven't earned the situation that they are in.
It's about sales projections based on the supply chain. There is a high level reference to the general political situation too (the trade war in general) referencing manufacturing options.
Competition obviously has a constant influence on sales projections, as does the feature spread of the phones and the final prices but to insert your North Korea claims in here is pretty way off base.
In the name of accuracy, it should be "Bloomberg: Apple expects..."
I suspect Avon was right. With any given hardware release, there is a certain amount of 'guaranteed' initial sales - hardware reviewers, people who upgrade every year, etc. The real question is the number of sustained sales. Depending what the features are, those could well continue to be lackluster, for the same reasons smartphone sales have been rather cool in general the last couple of years. 5G anticipation could keep things down a bit, too. Of course, that's making plans based on rumors based on promises of an un-proven technology with extremely limited availability. But hey, that's what people do, right?
"I've already read many investor notes on this subject and yes, iPhone sales will remain static in the 190-210 million range annually for the foreseeable future. But the upside for services as a large revenue contributor continues to get missed by most analysts."
https://twitter.com/BenBajarin
He has a pretty good track record on Apple.
https://time.com/5633390/fbi-christopher-wray-china-counterintelligence/
"Wray said Chinese companies aren’t independent of the Chinese Communist Party, and that the country uses both legal and illegal means including hacking, getting information from Chinese graduate students at American universities and partnerships with American companies.
He said some major universities have essentially created a “pipeline” of intellectual property heading back to China."
Tell me if you think the so called 'peak iPhone' has come and gone or if there is still room for a big shift upwards. Are these supposed iPhone goals conservative or unreasonably high? Tell me if you think prices will be adjusted downwards this September? Tell me if Samsung and Huawei have kept iPhone sales from increasing? Tell me if you think the lack of 5G will have a negative impact on sales. Tell me if you think potential upgraders with enough disposable income (especially iPhone X users on a two year cycle) could skip the 2019 phones. Tell me if you think those who struggle to reach iPhone price points and have little option but to go for older models, resent the fact that they don't have access to 'new' iPhones with their corresponding new designs.
If want to unnecessarily plunk politics somewhere, better in an appropriate thread. I'll be the first to admit that Trump, China and Huawei are all tangled up and sometimes it isn't possible to avoid touching on the political side but I can't see much justification in this particular thread.
Whether Apple lowers its margins or creates a lower entry price point, I can't know, and I doubt that lack of 5G will lower sales this year below 180 Million, but if it does, one would expect a commensurate increase next year. I have stated that I expect 120 million of the new model in sales for next year, starting this September, based on the data I have seen for past model sales breakdown, ie, about 2/3 of iPhone unit sales are the current years models.
Apple's iPhone user base continues to grow, and while Samsung and Huawei sell more phones, they do so at a at much lower ASP, and Apple continues to generate much more revenue and profit from its iPhone lineup than all of the Android OS devices makers combined. Sure, it isn't in the 90% range, like it was in the past, but for a mature product line, I'm not seeing any crisis from Apple not competing in the mid and low range.
As for the politics, I am just pointing out that Huawei isn't likely to get the reprieve from Trump and the U.S. Government that you seem to be expecting, and I have not problem seeing this as relevant to the story.
but the 11 does seem more like an XS+.
One of the least interesting updates in a while.
/s
No wonder this site is called AppleINSIDER!
I thought Apple was still making over 90% of mobile revenue? Wait, I think "mobile" includes iPad. Do we have any recent figures?
Oh great. The "Apple releases the same phone every year!" meme returns.
When a recession hits, I'm convinced that we will see a further consolidation of Android OS device makers, and some exiting the market entirely. Apple will be fine, needless to say.
If Apple does eventually decide to reduce pricing this year, obviously iPhone revenue per phone will drop. To maintain margins, Apple might have to reduce costs but what about economies of scale and other associated advantages? Component negotiations, etc. Their position will weaken. Obviously the reason for any price drop will be to stimulate sales, but what if that doesn't happen?
As for having the bulk of the profits, well you would have to define what you consider 'the bulk' because 51% wouldn't be saying much when I've already seen Apple at an estimated 60% (and those were better times). Also, if those profits were all that mattered, Apple wouldn't consider reducing prices. Especially as so many people here claim marketshare isn't an Apple goal.
Strange, as Apple still needs critical mass (a threshold of iPhone sales) to keep its economies of sale looking healthy. Without it, things like the A series SoCs become more expensive to produce, which in turn, would impact prices. Look no further at the financial impact of the Samsung display 'penalty'.
I'm generalising of course but the first paragraph of this post is undeniable.