Is the Apple iPhone X dead?

Every year when Apple comes up with a new iPhone, the excitement and expectations are very high. Last year in September, when Apple unveiled the iPhone X – it’s 10th Anniversary edition iPhone – to the world, it was seen as the most advanced piece of technology in the smartphone world. About six months into the iPhone X’s life cycle and people are already showing signs of being bored with Apple’s most expensive iPhone yet.

Apple iPhone X

According to data collected in a survey by research group Consumer Intelligence Research Partners (CIRP), more people in the US prefer buying the regular iPhone 8 and iPhone 8 Plus than spend a fortune getting the “ultra-premium” iPhone X.

The report shows that the iPhone 8 made up 23 percent of the total iPhone sales in the first quarter of 2018 and the iPhone 8 Plus 21 percent, whereas the iPhone X accounted for an unimpressive 16 percent.

The sales figure is a 4 percent decline from the 20 percent it had contributed in the previous quarter.

The survey also reveals the trend among buyers towards buying past years’ iPhones.

During the same months in 2017, the then brand new iPhone 7 and iPhone 7 Plus had accounted for nearly 70 percent of the iPhone sales.

The survey findings underline the dying interest among customers for the latest iPhones, and also the fact that a majority of iPhone buyers are still buying older iPhones models that are one, two or even three years old.

So does this mean the iPhone X is a flop and why?

According to a top analyst at asset management firm Piper Jaffray, the response to the iPhone X has been lukewarm, to say the least, and one of the main reasons it cited was that many buyers believed that the device is just too expensive.

Apple iPhone X
A man holds two boxes for the Apple’s new iPhone X at the Apple Store in Regents Street in London, Britain, November 3, 2017.REUTERS/Peter Nicholls/File Photo

A report carried by Apple news site PED3.0, Michael Olson, a senior researcher with Piper Jaffray, found that 44 percent of the respondents who didn’t want to upgrade to the iPhone X said that they disliked the idea because their current iPhones worked fine. And more than a third of the respondents claimed that the iPhone X which starts at $999 (Rs. 89,000 in India) is too expensive.

Has Apple killed the iPhone X?

Apple is expected to unveil the new 2018 iPhone line-up later this year, but right now the Cupertino-headquartered tech giant is facing testing times, with a leaked report suggesting the iPhone X is essentially “dead.”

Many analysts believe that the abysmal sales combined with the difficulty in obtaining the materials and the high cost of manufacturing may have discouraged Apple from pursuing the iPhone X further.

Now, this might come as a shock to many but it comes from analysts like KGI Securities’ Ming-Chi Kuo who has a clear track record when it comes to all things related to Apple.

Kuo said in January that iPhone X could be canceled. He later predicted in March that Apple could cease the production of the iPhone X mid-year.

Apple is reportedly gearing up to introduce three new iPhones in 2018 – a 5.8-inch OLED iPhone X successor, a 6.1-inch OLED model, and a bigger 6.5-inch iPhone X Plus model. And Kuo believes that one of these will be more popular than the others.

The latest leaked report suggesting the iPhone X’s demise comes from Neil Campling, Co-head at Mirabaud Securities, who states that Apple “will not produce a single iPhone X because it will be canceled after just one generation.”

The analyst further says that Apple over-estimated the iPhone X demand so much that it has already made all the units it will need till the next iPhones arrive.

Customers queuing outside a store in Tokyo, Japan for iPhone X 

“The iPhone X is dead,” Campling stated in the leaked investor note.

The most probable reason he says, “the simple problem with the iPhone X is that it is too expensive.”

The initial craze for the iPhone X made Apple over-estimate the demand and order its suppliers to manufacture heaps of iPhone X components so that it doesn’t run short of the components to meet the impending demand.

One such example is Apple chip supplier TSMC, which Campling says has been badly burnt by experience causing its inventory stockpiles to hit “record highs.”

The stockpiling problem has left a lot of Apple suppliers with declining profits and revenues, due to the plummeting smartphone demand.

Will a sales “Supercycle” help the iPhone X shipments?

According to a Forbes report, many Industry insiders have warned that no amount of the so-called sales “supercycle” is going to help Apple materialize the iPhone X sales, and the numbers are now not even expected to match the iPhone 7.

iPhone X shipments expectations by KGI
iPhone X shipments expectations by KGIReuters

Moreover, iPhone sales have been continually on a downward trend the iPhone 6 in 2014.

Nevertheless, the iPhone X’s failure should not be seen as a bad thing by the customers who can now expect Apple to learn a lesson and price their upcoming phones more reasonably and bring more invention in the iPhone range to woo customers.

What will be interesting to see is how Apple reacts to the iPhone X’s sales figures and whether it will surprise us with a slightly cheaper new iPhone X successor later this year.

 

Source by ibtimes..