Updated: Apple's iPhone shipments fell off a cliff last quarter -- results were worse than the Street expected. And it doesn't look like the mid-priced iPhone SE will help this quarter, either.
[Developing story. Updated 9:59 am and 2:53 pm PT with more comment]
Revenue reduced, profit plummeting, unit-sales unraveling. To an extent, Wall St. saw this coming, but few foresaw just how big the drop would actually be.
Is this the end for iPhone? Hardly, but investors need to stop hoping for continued growth, as if AAPL was some sort of never-ending Ponzi scheme.
In IT Blogwatch, bloggers draft the drawer obits, just in case. Not to mention: What is PAXOS?
Your humble blogwatcher curated these bloggy bits for your entertainment.
What’s the craic? Alex Webb reports iPhone Woes Deepen:
Apple Inc.’s streak of 51 consecutive quarters of...sales growth is over. ... That era of untrammeled expansion hit a wall. [Apple] is predicting another decline in the current period.
Second-quarter sales slid 13 percent [year on year]. ... The smartphone market “is currently not growing,”...Cook said. ... “That’s an overhang of the macroeconomic environment.” ... Apple is no longer able to count on China as a growth engine.
Who wins headline pun of the day? Shaun Nichols does, with that's the way the Cookie grumbles:
Apple has confirmed analysts' fears. [Profit] was down 26 percent from...a year ago. ... Regional revenues declined in...every region [except] Japan.
Cook noted that the upgrade rates...were lower than those of last year. [He] would not release sales figures for the Apple Watch. [He] put a brave face on [it] describing the revenue dip as a "pause".
I detect we're getting closer. Zac Hall effects a Live blog:
Nice groan from Tim Cook. ... Another groan, seriously.
Apple plans to lower channel inventory...which will impact revenue in Q3. ... iPhone sales...comparison tricky following [strong] quarter last year.
Challenging quarter for PC sales. ... iPhone ASP will decrease. ... Inventory reduction will come from higher end models. ... Worst gross margin in year and a half.
Let's soup up the rhetoric. Mikey Campbell puts a brave face on the iPhone SE's surprise demand:
Cook said the device...is attracting not only new [customers], but also existing customers looking for...a 4-inch form factor. ... "It's clear there's a demand...much beyond what we thought."
He added that Apple is working to produce to fulfill demand. [It] runs counter to recent reports claiming...an uphill battle with iPhone SE sales.
This won't be the last time we see growth falter. You mark Dave Mark's “G” word:
The problem is that investors...want a reason to be optimistic that growth is still possible. [It] is much, much easier when you are small. [But] once you reach Apple’s size, continued growth is almost impossible.
Worried yet? Even John Gruber is alarmed:
I find it a little alarming that Apple was taken by surprise. [But] I don’t think it’ll take them long to get supply in balance.
Update 1: So... ding-dong iPhone is dead? Gavin Clarke belts out a song-reality calling:
This is not as bad for Apple as 2003 or 1996. [But] to many, this is will be inconceivable...a wake-up call.
But what’s really called for is some perspective. [Q2] 2015...was, as they say in Wall St, “a tough comparable”. ... But the flip side of staggering growth is...market saturation.
For all that, this is not 1996 all over again...the year when Apple lost more than $1.5bn – before...$150m rescue investment from Microsoft. ... What you are likely now looking at...is the new normal. [It] does look a lot like business in a post-growth market.
Update 2: Panic? No, Yoni Heisler says it is way overblown:
Not surprisingly, shares of Apple opened...8% lower when trading began. [But] there’s no way iPhone sales could have even come close to what Apple achieved during [Q2] 2015. ... The iPhone is still doing remarkably well.
Last year marked the release of the iPhone 6 and 6 Plus...two new iPhone models with distinct form factors [and] Apple’s first foray into...larger-sized smartphones. ... Sales during Q2 2015 were artificially higher due to supply constraints [but] this year, Apple got a handle on supply. ... S-cycle refreshes have historically performed worse.
the iPhone 7 will go on to shatter all previous iPhone sales records. ... Let’s see what the iPhone 7 brings...before categorizing Apple as a company on the downward trend.
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