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There is a decent amount of evidence that Apple's sales from the iPhone X (specifically) are less than expected, including 2-for-1 deals and Samsung cutting pro

There is a decent amount of evidence that Apple's sales from the iPhone X (specifically) are less than expected, including 2-for-1 deals and Samsung cutting production of OLEDs. At the same time the margins on the X are better than ever. I agree it's unnecessary commentary, but based in fact without too much speculation.

IBM 9y ago
BOGO deals always come out of the carrier's pocket. The iPhone is the best customer acquisition tool so it all works out for the carrier in the end. Apple is certainly not going to cut prices to enable that.
oflannabhra 9y ago
I haven't seen any iPhone X 2-for-1 deals, in the US at least. Samsung's OLED production glut can't be pinned solely on Apple [0]. Most of the "Apple slashes iPhone X production forecast" rumors seem to be... unreliable at best [1] [2]. [0] - http://www.patentlyapple.com/patently-apple/2018/02/apples-iphone-x-is-the-instant-scapegoat-for-samsungs-failure-to-win-oled-orders-from-chinese-vendors.html http://www.patentlyapple.com/patently-apple/2018/02/apples-i... [1] - https://www.ped30.com/2018/02/20/nikkei-slashes-apple/ https://www.ped30.com/2018/02/20/nikkei-slashes-apple/ [2] - https://twitter.com/rjonesy/status/958421107245232128 https://twitter.com/rjonesy/status/958421107245232128
- tooltalk 9y ago
  Yeah, we hear this every 1Q's. Apple's sales peak during the release quarter and steadily declines over the next three quarters, until the new one comes out next year. I think this natural decline has been misinterpreted by reporters who really don't know any better and misreported as "declining demand."
  - leoc 9y ago
    Apparently https://www.cnet.com/news/samsung-reduces-oled-panel-production-citing-poor-iphone-x-sales/ https://www.cnet.com/news/samsung-reduces-oled-panel-product... (warning: autoplaying video with audio :( ): > Samsung Display, Samsung's panel-making division, is reducing OLED panel production at its South Chungcheong plant, according to the Nikkei Asian Review, thanks to lower than expected iPhone X sales. > The report states Samsung now plans to cover 20 million or fewer iPhone X devices for the quarter ending in March, a large decrease from the expected 45 to 50 million units. (I certainly can't confirm the reporting.)
    - oflannabhra 9y ago
      Nikkei doesn't even support their own headline. Samsung Display saw YoY decreases in OLED purchases by themselves, increased competition from Chinese and Taiwanese display suppliers, and essentially zero adoption of OLED by Chinese phone manufacturers[0] (also linked above). All those factors get fewer headlines than Apple doom and gloom, though. [0] - http://www.patentlyapple.com/patently-apple/2018/02/apples-iphone-x-is-the-instant-scapegoat-for-samsungs-failure-to-win-oled-orders-from-chinese-vendors.html http://www.patentlyapple.com/patently-apple/2018/02/apples-i...
      - tooltalk 9y ago
        First, I wouldn't take anything out of patentlyapple.com seriously. Second, what Chinese and Taiwanese display suppliers are you talking about? There is no "other" OLED manufacturer who pumps out displays in Samsung's quality or quantity.
        oflannabhra 9y ago
        From the original Nikkei report [0]: > Other smartphone makers, who Samsung had hoped would incorporate OLED panels, have been slow to make the transition due to their expense and are sticking to liquid crystal displays. To make matters worse, Chinese OLED panel makers are expanding production capacity, heating up the price competition even more. >Display Supply Chain Consultants of the U.S. estimates the utilization rate at Samsung's OLED panel factories is around 50-60% due to sluggish demand from smartphone makers... [OLED] Supply capacity is expected to grow worldwide. LG Display of South Korea is set to launch a new production line as early as this year, and China's BOE Technology Group and Tianma Microelectronics have launched new factories with the assistance of government subsidies. Overall production capacity is expected to double by 2020...The bar in global competition will likely rise further for Sharp and Japan Display, which are preparing to start mass-producing OLED panels in 2018 or 2019. The PatentlyApple article just points out that Nikkei attached Apple to the headline for clicks, when the real OLED supply issue has little to do with them, and more to do with Samsungs own poor forecasting. [0] - https://asia.nikkei.com/Business/Trends/OLED-panel-glut-looms-as-Apple-slashes-iPhone-X-production https://asia.nikkei.com/Business/Trends/OLED-panel-glut-loom...
spike021 9y ago
Are the 2-for-1 deals directly from Apple? As far as I know this is from retailers who already purchased the stock in bulk from Apple. Even if there's less interest causing deals like those, they're already technically "sold" from my understanding.
- dragonwriter 9y ago
  > Are the 2-for-1 deals directly from Apple? As far as I know this is from retailers who already purchased the stock in bulk from Apple. Even if there's less interest causing deals like those, they're already technically "sold" from my understanding. If you are Apple doing forward planning, retailers being unable to move your stock because retail sales were slower than expected had to figure into your planning as weak sales even if it doesn't show up in your current financials that way, because you can't expect that retailers are going to forget when ordering the next model: if you don't want them to cut orders, you have to give them a reason to think that the disappointing nresults won't be repeated.
philwelch 9y ago
Apple finally having a supply chain that can keep up with demand != lower-than-expected demand.
lostapathy 9y ago
I always wondered if the price of the iPhone X wasn't set as high as it is as a way to segment the market and limit demand on that device, and perhaps they just miscalculated. Everybody was nervous about iPhone X part yields and overall supply ahead of the launch, after all. From all the tear downs I've seen, there's obviously plenty of profit in that phone to charge a lower price. But if the iPhone X was $150 cheaper, a lot of iPhone 8 buyers would have waited for an X, and the headlines would all be about iPhone X shortages, the iPhone 8 would be the phone not selling, and Apple would end up moving less units than they are now. So if that's the theory, perhaps Apple knew they were pricing the iPhone X a little higher than they should, but they had to do it that way to keep enough people buying their other phones for yields and production to catch up?
seanmcdirmid 9y ago
Who is offering iPhone X 2-for-1 deals?
- oflannabhra 9y ago
  no one. I've only seen iPhone 8 BOGO deals, for new subscribers.

IBM 9y ago

BOGO deals always come out of the carrier's pocket. The iPhone is the best customer acquisition tool so it all works out for the carrier in the end. Apple is certainly not going to cut prices to enable that.

oflannabhra 9y ago

I haven't seen any iPhone X 2-for-1 deals, in the US at least. Samsung's OLED production glut can't be pinned solely on Apple [0]. Most of the "Apple slashes iPhone X production forecast" rumors seem to be... unreliable at best [1] [2]. [0] - http://www.patentlyapple.com/patently-apple/2018/02/apples-iphone-x-is-the-instant-scapegoat-for-samsungs-failure-to-win-oled-orders-from-chinese-vendors.html http://www.patentlyapple.com/patently-apple/2018/02/apples-i... [1] - https://www.ped30.com/2018/02/20/nikkei-slashes-apple/ https://www.ped30.com/2018/02/20/nikkei-slashes-apple/ [2] - https://twitter.com/rjonesy/status/958421107245232128 https://twitter.com/rjonesy/status/958421107245232128

tooltalk 9y ago
Yeah, we hear this every 1Q's. Apple's sales peak during the release quarter and steadily declines over the next three quarters, until the new one comes out next year. I think this natural decline has been misinterpreted by reporters who really don't know any better and misreported as "declining demand."
- leoc 9y ago
  Apparently https://www.cnet.com/news/samsung-reduces-oled-panel-production-citing-poor-iphone-x-sales/ https://www.cnet.com/news/samsung-reduces-oled-panel-product... (warning: autoplaying video with audio :( ): > Samsung Display, Samsung's panel-making division, is reducing OLED panel production at its South Chungcheong plant, according to the Nikkei Asian Review, thanks to lower than expected iPhone X sales. > The report states Samsung now plans to cover 20 million or fewer iPhone X devices for the quarter ending in March, a large decrease from the expected 45 to 50 million units. (I certainly can't confirm the reporting.)
  - oflannabhra 9y ago
    Nikkei doesn't even support their own headline. Samsung Display saw YoY decreases in OLED purchases by themselves, increased competition from Chinese and Taiwanese display suppliers, and essentially zero adoption of OLED by Chinese phone manufacturers[0] (also linked above). All those factors get fewer headlines than Apple doom and gloom, though. [0] - http://www.patentlyapple.com/patently-apple/2018/02/apples-iphone-x-is-the-instant-scapegoat-for-samsungs-failure-to-win-oled-orders-from-chinese-vendors.html http://www.patentlyapple.com/patently-apple/2018/02/apples-i...
    - tooltalk 9y ago
      First, I wouldn't take anything out of patentlyapple.com seriously. Second, what Chinese and Taiwanese display suppliers are you talking about? There is no "other" OLED manufacturer who pumps out displays in Samsung's quality or quantity.
      - oflannabhra 9y ago
        From the original Nikkei report [0]: > Other smartphone makers, who Samsung had hoped would incorporate OLED panels, have been slow to make the transition due to their expense and are sticking to liquid crystal displays. To make matters worse, Chinese OLED panel makers are expanding production capacity, heating up the price competition even more. >Display Supply Chain Consultants of the U.S. estimates the utilization rate at Samsung's OLED panel factories is around 50-60% due to sluggish demand from smartphone makers... [OLED] Supply capacity is expected to grow worldwide. LG Display of South Korea is set to launch a new production line as early as this year, and China's BOE Technology Group and Tianma Microelectronics have launched new factories with the assistance of government subsidies. Overall production capacity is expected to double by 2020...The bar in global competition will likely rise further for Sharp and Japan Display, which are preparing to start mass-producing OLED panels in 2018 or 2019. The PatentlyApple article just points out that Nikkei attached Apple to the headline for clicks, when the real OLED supply issue has little to do with them, and more to do with Samsungs own poor forecasting. [0] - https://asia.nikkei.com/Business/Trends/OLED-panel-glut-looms-as-Apple-slashes-iPhone-X-production https://asia.nikkei.com/Business/Trends/OLED-panel-glut-loom...

spike021 9y ago

Are the 2-for-1 deals directly from Apple? As far as I know this is from retailers who already purchased the stock in bulk from Apple. Even if there's less interest causing deals like those, they're already technically "sold" from my understanding.

dragonwriter 9y ago
> Are the 2-for-1 deals directly from Apple? As far as I know this is from retailers who already purchased the stock in bulk from Apple. Even if there's less interest causing deals like those, they're already technically "sold" from my understanding. If you are Apple doing forward planning, retailers being unable to move your stock because retail sales were slower than expected had to figure into your planning as weak sales even if it doesn't show up in your current financials that way, because you can't expect that retailers are going to forget when ordering the next model: if you don't want them to cut orders, you have to give them a reason to think that the disappointing nresults won't be repeated.

philwelch 9y ago

Apple finally having a supply chain that can keep up with demand != lower-than-expected demand.

lostapathy 9y ago

I always wondered if the price of the iPhone X wasn't set as high as it is as a way to segment the market and limit demand on that device, and perhaps they just miscalculated. Everybody was nervous about iPhone X part yields and overall supply ahead of the launch, after all. From all the tear downs I've seen, there's obviously plenty of profit in that phone to charge a lower price. But if the iPhone X was $150 cheaper, a lot of iPhone 8 buyers would have waited for an X, and the headlines would all be about iPhone X shortages, the iPhone 8 would be the phone not selling, and Apple would end up moving less units than they are now. So if that's the theory, perhaps Apple knew they were pricing the iPhone X a little higher than they should, but they had to do it that way to keep enough people buying their other phones for yields and production to catch up?

seanmcdirmid 9y ago

Who is offering iPhone X 2-for-1 deals?

oflannabhra 9y ago
no one. I've only seen iPhone 8 BOGO deals, for new subscribers.