EC What Happened To The Iphone?

When Apple (AAPL) first came out with the iPhone in 2007, it was truly a revolutionary product. Even for those of us who hadn’t been impressed with Apple’s computers had to tip our caps to Steve Jobs (and team) for what they had pulled off. He knew it, of course, which is why earlier that year Apple Computer had dropped the latter word from its corporate name to become simply Apple Inc.

As with any new introduction, sales started minimally. In its first quarter on the market, Q3 2007, Apple sold all of 27 million units. The ramping up of adoption, however, took very little time and was all the more impressive given the economic backdrop of the process. In Q4 2008, during the worst global economic climate since the Great Depression, the company managed sales of 6.89 million. That was a 515% gain at a time when other major mainstream companies were begging the Fed for commercial paper funding as their baseline revenues plummeted.

Those massive growth rates didn’t last forever, nor was anyone expecting that they would. At some point a new and innovative product becomes a mature one. In Q1 2012, Apple shipped 37 million iPhones for a gain of “just” 128%. Late in 2014, the iPhone 6 was introduced, sprinkling a little more magic into shipments of 74 million by Q1 2015. That was a substantial increase befitting the long lines at Apple stores, growth of almost 46% from Q1 2014.

That was the last of it, however. Despite several new versions and models introduced over the intervening three years, Apple can find no more excitement. As of Q1 2018, the company reported just 77 million sold and shipped worldwide. That’s not even 4% more than the company managed three years prior. And it was down 1.2% from Q1 2017.

What happened?

Like anything else, there are a number of factors to consider, including tablets. Buyers are less impressed, and enthused, by new models which don’t offer as substantial improvements as earlier model switches had. Apple also has several key competitors who have caught up and in some ways surpassed the iPhone. Dominance is no longer a given.

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Power Hedge 2 years ago Contributor's comment

I saw a survey back in August that essentially said that Chinese people as a whole felt that the iPhone X was far too expensive and they weren't interested in shelling out that kind of money for a smartphone.

Personally, I have an iPhone SE. I won't be buying another iPhone until Apple offers another one with a 4" screen. For me, the new phones are far too large.

Surae Magruf 2 years ago Member's comment

#Apple is proving itself to be little competition in the field of ingenuity as of its most previous models. However, it's still going to sell well due to its brand. Many consumers are more concerned with brands. Clout reigns over functionality these days.

David J. Tanner 2 years ago Member's comment

I agree, there's nothing to get excited about anymore. So it's a tad faster or a tad thinner. Who cares? It's not worth shelling out another $300 to $700. They gotta wait for the next meaningful technological enhancement to get people to bite.

Better yet, #Apple should be looking for something else that needs to be redesigned.

Louis Jackson 2 years ago Member's comment

I have an iphone 7 which still feels brand new to me. I didn't really need to get it at the time, but I was eligible for an upgrade. I honestly like my old 6 just as well. As long as they're doing little more than upgrading processors and cameras, I won't buy a new one anytime soon. I don't understand how people get so excited over the newer ones.

Danny Straus 2 years ago Member's comment

i believe Android devices stay relevant longer than Apple devices. I have an old iPad that's pretty much a paperweight since almost every app needs a newer OS. But Apple won't let me upgrade to the latest OS.

Roland Murphy 2 years ago Member's comment

I have the same problem. Would be nice if Apple let me continue to use the old apps which worked just fine. But they force you to upgrade the app (it will force close saying an upate is needed). But when you try to update, it fails because the operating system is too old. The whole thing is a shrewd scam by Apple and it's why I too switched to Android. I just hope they don't end up doing the same thing.

Louis Jackson 2 years ago Member's comment

I may look into alternatives like Android when I'm ready for a new phone (hopefully at least a couple of years from now).

Angry Old Lady 2 years ago Member's comment

I agree with everything you said. But lately I've noticed a definite slowdone in my old Apple devices. They are downright sluggish. I feel that I'm being forced to upgrade and now I learned that Apple did it on purpose! My husband never had this problem with his android device. He is still on a Galaxy S3 and it works perfectly.

Louis Jackson 2 years ago Member's comment

That was inexcusable what Apple did to older phones. Supposedly even some iphone 6/7's were affected. I think Apple is supposed to be fixing that issue.

Angry Old Lady 2 years ago Member's comment

I heard that their "solution" was to sell people new batteries at a discounted price. I'm sure many will opt to just buy a new phone altogether. Besides who can afford to be without a phone while the battery gets replaced. We can't do it ourselves like old phones.

Louis Jackson 2 years ago Member's comment

I read that there would be a software update that would allow users to improve power and show more data regarding the health of the battery. Hopefully this will be the case.

Louis Jackson 2 years ago Member's comment

Here's the release from Apple back in December that mentions the software update in early 2018 :

Kevin Richards 2 years ago Member's comment

#Apple has excelled at identifying the next big thing and making it better. It did it with computers, MP3 players, tablets, and phones. It never invents a thing. I think they've run out of ideas. $AAPL

Ayelet Wolf 2 years ago Member's comment

This is true, but as you said, that is where #Apple excels and will continue to do so. The problem is that it's difficult to get excited about new phones or tablets when old ones still work so well (despite Apples attempts at intentionally slowing down older models to spur new purchases).

If history is any judge, when the time comes, Apple will identify the next "big thing," make it better, and make a killing. $AAPL will go then go even higher.