Raymond James lowers iPhone unit estimates

“Apple Inc.’s iPhone estimates have been lowered yet again ahead of its quarterly earnings, this time triggered by a weak chip outlook by supplier Qualcomm Inc.,” Jennifer Booton reports for MarketWatch. “A number of reports from Apple suppliers in recent weeks have set off alarms that Apple could be headed for its first ever year-over-year decline in iPhone sales when it reports fiscal second-quarter earnings after the market’s close on Tuesday.”

“This week, Qualcomm which supplies chips to the iPhone 6 and Samsung Electronics’ Galaxy 7 phone, reported a 19% decrease in chip shipments to 189 million and gave a weak chip segment outlook of between 175 million and 196 million, which implies a 13% to 22% year-over-year decrease,” Booton reports. “The weak outlook supports the thesis that the iPhone 6 and iPhone 6s family of phones are still suffering through a ‘hangover period’ following strong initial sales, and that the new four-inch iPhone 5SE isn’t selling as well as expected, said Raymond James analyst Tavis McCourt.”

MacDailyNews Take: Or maybe nobody wants beleaguered Samsung’s latest piece of shit? Nobody with a working brain, or eyes, or taste, certainly.

Even if a particular data point were factual it would be impossible to accurately interpret the data point as to what it meant for our overall business because the supply chain is very complex and we obviously have multiple sources for things, yields might vary, supply performance can vary. The beginning inventory positions can vary, I mean there is just an inordinate long list of things that would make any single data point not a great proxy for what’s going on. Apple CEO Tim Cook, January 23, 2013

“Among the concerns raised recently by analysts is that consumers aren’t upgrading as quickly as they used to, which BTIG analyst Walter Piecyk said is partially a reflection of the company’s biannual cycles of Apple’s S model and numbered smartphones,” Booton reports. “Last month, Piecyk said a ‘structural change’ could be under way in the pace of upgrades.”

Read more in the full article here.

MacDailyNews Take: Let’s hope Piecyk is correct. We’ve been looking for a “structural change” to iPhone release for years and as recently as last Tuesday:

Apple should strive to execute annual iPhone updates, in three display sizes if the SE is successful (which we think it will be), and drop the off-year “S” model concept. Apple is certainly big enough and rich enough to do a new iPhone family each and every year. Apple should have killed the tock year “S” model idea years ago.

What’s happened with iPhone is painfully obvious: Apple was at least a year (more likely two years) late with properly-sized iPhones. When iPhone 6 and iPhone 6 Plus finally, blessedly materialized, buyers quite literally stampeded to get them. Then, when faced with such a “tough compare” this year, Apple was still sticking with their ill-conceived “S” model concept – making the tough compare much, much tougher.

The “iPhone 7” family – three models with the same case design and all with 3D Touch — comprised of the 4-inch iPhone 7 SE, the 4.7-inch iPhone 7, and the 5.5-inch iPhone 7 Plus — should have debuted last September. That would have taken care of the current tough compare with iPhone 6/Plus. Then, this year, the iPhone 8 family, again with a new case design, but now waterproof, with dual cameras, etc. would debut this September. In 2017, perhaps Liquidmetal and AMOLED will be ready go for the iPhone 9. Etcetera. No more “S” years, Apple. Duh.

Had Apple done as we’ve just described, they’d have sold millions more iPhone units this year and millions upon millions more each year going forward.

Apple’s raison d’être is to delight customers. “S” model “tock” year iPhones do not delight customers in the same way as new “tick” year models. Obviously. They’re still the best smartphones on the planet, but they’re just okay. A bit of a meh. We all know that “S” models exist so Apple can wring out nice margins from existing designs and tooling, not expressly to delight customers. When Apple strays from its main goal is when things get wobbly. Just delight customers, Apple, and the world will beat a path to your door.

If we didn’t work for MacDailyNews, we’d have skipped the iPhone 6s Plus and held onto our iPhone 6 Plus units with no qualms – and we’re the most rabid Day One iPhone buyers you’ll ever find.

Why have an annual iPhone upgrade program, if you’re not going to wow us annually with new iPhones?

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