Apple skids after Verizon says iPhone activations plunge 25%

“Apple shares fell more than three percent to below $585 after Verizon said it activated 25 percent fewer iPhones last quarter than it did during the last three months of 2011,” John Melloy reports for CNBC.

“Verizon sold 3.2 million iPhones last quarter, according to the company’s chief financial officer Francis Shammo. That’s down 26 percent from the 4.3 million iPhones activated during the fourth quarter of last year,” Melloy reports. “‘If Verizon’s percent of iPhone sales remains stable from Q4, then this could suggest that Apple will sell 28.2 million iPhones during the past quarter,’ wrote StreetInsider.com, a widely-followed provider of market insight, in a post that seemed to add to Apple selling pressure after its release. ‘If this is the case, then Apple would miss the consensus of 30 million iPhone units during the quarter.'”

“To be sure, last quarter including the big holiday spending period. What’s more, some analysts countered the Verizon extrapolation analysis by noting international sales would be stronger this time around,” Melloy reports. “‘We remain comfortable in our 33m unit estimate based on faster international growth fueled by the January launch of iPhone 4S in China,’ wrote Piper Jaffray analyst Gene Munster in a note Thursday afternoon amid the Apple sell-off.”

Read more in the full article here.

MacDailyNews Take: Christmas quarter in the USA is a big selling period. Extrapolating worldwide iPhone unit sales based only on Verizon’s U.S. iPhone numbers for Christmas 2011 quarter vs. calendar Q112 is a fool’s errand and/or a manipulator’s trick.

[Thanks to MacDailyNews Reader “Lynn Weiler” for the heads up.]

40 Comments

  1. Just got back from 2 weeks in China. The number of iPhones visible in Shanghai are amazing. On the subways, I’d guess over 50% are iPhones. Of course, Shanghai is the NYC of China so one would expect iPhone penetration to be highest there. What surprised me was the number of college and even high-school aged kids pulling out iPhones. I really didn’t see any iPhone fakes.

    1. Forgot to add, I saw NO Blackberries or Nokia phones. Considering how dominating Nokia was in China just a few years ago, I was shocked. I’m sure there are tons of Nokia’s in the hinterlands, but Shanghai is like NYC, it’s the leading edge of the trend, so that bodes poorly for both companies.

      Also, while iPhones were ubiquitous, I saw HTC as the most popular Android brand. I saw ZERO Samsung Notes. While Android fans in the US may buy the marketing message that larger screens are better, in China, larger phone screens didn’t seem to resonate as much. I don’t think I saw a single phone with a screen larger than 4″.

      Of course, this is all anecdotal, as these were just my observations.

    2. I just got back from Vietnam and had the exact same experience, especially in Hanoi.

      It was all iPhones (and iPads) very few Blackberries or Android devices. There were two or three shops selling iPhones (and other Apple devices) per block on many streets in Hanoi. When you consider the relative cost of an iPhone in VN, compared to the US, it’s a powerful testimony to Cult of Steve.

    3. I, too, regularly travel to China, and often through Shanghai, and am astonished by the number of iPhones I see there. Funny you should mention subways, since that is where I often take the time to count screens. I would say that 50% of all smartphones I see are iPhones, tho’ there are a substantial percentage of feature phones still in use. It is also notable that the Shanghai Apple stores – I’ve been in both the Pudong and Nanking Road stores – are always packed. The Chinese LOVE Apple.

      1. I stayed within 5 mins of the first Shanghai Apple Store, the one on Huaihai Road. I took my nephew there to get it unlocked,(he had forgotten his password), and realized the place was totally booked, just like in the US. Also, we passed the closed Barbie store, which was a little shocking, as my nephew’s Great Uncle used to run Mattel. Great location, 3 stories, if it wasn’t so close to the HuaiHai Apple Store, I’d say Apple would rent it, as it’s perfectly sized for Apple. Given how much in demand retail space is on HuaiHai Road, Nanjing Road, and Pudong, I can’t figure why the Barbie store hasn’t been rented out yet. Yes, those three locations are the best locations in the City. The first two are the traditional shopping streets in Shanghai, and Pudong is the totally new area, but you can’t find a more exclusive spot than the Pudong Apple Store. It’s right between their two tallest buildings.

  2. In an earlier article on mdn the same numbers we’re painted with a very different picture. Half of smartphones sold were iPhones. The numbers were lower than xmas but that is normal.
    The other article also pointed out that the iPhone was released to more countries this quarter so could boost numbers significantly.

    Pure manipulation by the hacks.

  3. Nowhere I could find in either article did it mention whether sales were up or down compared to last quarter on any of the OTHER phones; only iPhone (and some nebulous “LTE phones” category, which wasn’t compared to the previous quarter).

    Only at the end of the article did they even mention the holiday effect of iPhone sales… You know, because people actually WANT iPhones for Christmas.

    Bunch of crap.

    1. It’s just about the same for all other phones as well. People are making a big deal out of it is because its Apple. Why bother saying, “Verizon smartphone activations down 25% from Q4 2011” and possibly leave “Apple” or “iPhone” out of your headline and miss a link-bait opportunity?

      7.7 million sold in 2011Q4
      6.3 million sold in 2012Q1

      About 22% down overall.

  4. More important data is Apple’s share is sales, rather than absolute number.

    According to latest data, Apple’s smartphone share in February was even slightly higher than in December.

    So while absolute numbers of iPhone sales might be 28-33 million, this still advance for Apple in market share.

  5. America’s fixation with monwy is getting completely out of hand. We’ve gotten to the point that every product, no matter how revolutionary, is judged solely by its sales figures. Nothing else matters. And nothing could be more absurd.

    1. Then move to North Korea and STFU. (If you don’t STFU, they’ll lop your head off and dump you in an unmarked grave.)

      Nobody with a brain here in the free world cares about your commie ramblings.

        1. Holy-tap-dancing-christ! Can we skip the political commentary on this site? Most of you don’t even know the meaning of half the things you say. But I guess, ignorance is bliss and so is blind faith.

      1. So Reality, you’re saying products should be judged solely by their sales numbers?

        Okay… Then why aren’t you using a PC? Do you have an Android phone? You don’t? Well, go live in North Korea, commie. How dare you value anything other than pure, capitalist marketshare?

    2. I think you are pulling the wrong conclusion from this. The issue here is about Traders and Quarterly Sales numbers. Traders don’t care a rat’s ass about what a company makes or its various attributes. Unfortunately they also don’t care to look at macro pictures. A single number from a single source looks bad, they sell off and look for a more promising stock to trade. Traders drive the stock price and traders are not investors. They also do not reflect how the general public judge a company or its products, even here in America.

  6. @derss
    It is my opinion that marketshare is not very relevant. it is far more important to Apple’s bottom line the number that they sold.

    With that said, the 28.2 million number should be taken as an absolute minimum number as it assumes that Apple did not expand the markets into which it was selling the iPhone during Q1 of calendar 2012.

    Just my opinion.

  7. What a laugh. I bet I could take Apple’s shares down a few dollars if I posted a blog saying I decided not to buy an iPhone. I don’t think one could ever find such an easily manipulated stock that has the fundamentals Apple has. If ten analysts upgraded Apple and one analyst downgraded Apple, the analyst that downgraded Apple would take priority. I’m long Apple 2004, but I almost feel sorry for those that have bought Apple shares recently. They must be going through hell trying to figure out what’s going on with Apple’s share price.

    I realize that a few down days don’t mean a damn thing in the long run, but it’s really just pathetic how easily it is to take Apple share price down on decreased sales from one carrier. For all we know, Sprint could have taken iPhone sales away from Verizon. I really like the way Verizon offers up these numbers right before earnings. They really are a bunch of dicks.

  8. Last quarter was the first time a new iphone launched on Verizon (that is not a model that had been on other networks for a while.) Huge pent up demand. Between that and the holidays, only a 25% drop off (and still outselling Android) is pretty freaking impressive.

    No carrier in the US has done more to push Android. And yet even in a non-new product launch quarter, iPhone outsells all Android models combined. And there’s no 3GS so no free with contract model either.

    Yeah this is bad news. Apple is DOOMED.

    Stock market reaction is obvious… either hot money or longer term investors with huge profits… looking for an excuse to sell. Stocks that go up fast correct hard along the way. It’s what stocks do…

  9. Dunno. I’m curious to know how AT&T activations did during the same period, as everyone I know who were once VZ customers stuck to iPhones but dumped Verizon.

    I mean, seriously, a carrier in 2012 that can’t even do such basic tasks as simultaneous voice and data? What did VZ expect would happen when people found how limiting a 1980’s network really is?

  10. God i feel sorry for all you fan boys. Wake up and smell the roses. How about something subjective? Have you fan boys thought about how carriers are subsidizing Iphones? 100/phone at 1M they are losing 100M. That’s a lot of money and soon these carriers will have to promote a 3rd ecosystem or just get rid of the subsidies all together since exclusivity wont matter anymore. Guess what that translate to? Drop in sales. Pull all your heads out of Job’s ass and quit being cheerleaders for once.

    1. You haven’t even done the most basic analyses. Carriers subsidize LOTS of smartphones, not just the iPhone. Are you proposing they are planning to drop all subsidies for all phones? Or just the iPhone. If just the iPhone, that is ludicrous. Utter nonsense. If all phones that’s just as ridiculous.

      If they are lowering subsidies, then you have to show what the current highest subsidy for a non-iPhone is, to get a sense of what a potential subsidy drop might show. Further, any pressure to reduce subsidies is counter-balanced by the fact that a desperate company like Sprint will keep them high, in order to attract customers willing to defect. That’s COMPETITION.

      The fact of the matter is that as long as the iPhone is the most desired single phone in the market, it will command the highest subsidies.

      This has nothing to do with being a fan, it has everything to do with logic, and markets. Clearly, you have little to no experience and are only spouting off some nonsense you read.

  11. Always note the timing of these news items. Nothing but market manipulation by crooks. Within 24 hours look for a top analyst to raise his stock price for Apple to $850!

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