
Apple Profit and Revenue Slide as It Copes with Slumping iPhone Sales - monsieurpng
http://www.wsj.com/articles/apple-profit-and-revenue-slide-as-it-copes-with-dwindling-iphone-sales-1477427419
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rplst8
I think the market for high-end phones and devices is probably starting to
saturate. Apple has also been relying a bit too much on planned obsolescence,
specifically through software updates.

Iterating over iDevices and essentially making them thinner and thinner or
mini versions of them (i.e. the watch) doesn't really speak of "innovation" to
me.

Apple's real prowess has been in economies of scale, industrial engineering,
and supply chain management. This is how they extract more profit from their
devices.

However, that profit is now largely based on the same principles of why high-
fashion brands can charge $500 for a pair of jeans or shoes. It's also a bit
perilous in the sense that once demand falls for "the brand" then a lot of
margin just vanishes off the books.

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Ntrails
> I think the market for high-end phones and devices is probably starting to
> saturate. Apple has also been relying a bit too much on planned
> obsolescence, specifically through software updates.

My iPhone 4 had four years of updates provided instantly and at no cost. In
comparison to competitors I'd argue strongly that Apple has historically had
better support for old models than most.

However. I owned my 4 for a pretty long time, because it did everything I
needed (until the home button died). I expect my 6s will last a long time too
- probably again limited by a hardware fault. Much like PCs, the improvements
get smaller and so the impetus to upgrade regularly drops.

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ksk
Apple absolutely does do planned obsolescence. Apple continuously hammers you
with popups to update the OS till you accept. My 4S slowed down to a crawl
after I foolishly kept updating the OS. Luckily, I've found a way to block the
updates now and hopefully my 6S will give me a much more pleasant experience
than my 4S.

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jaitsu
"Apple sales slump... compared to unrealistic expectations."

Wake me up with some news.

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angryteabag
Please open macOS to non Apple hardware. I'd actually buy a license for that.

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grzm
Apple is a hardware company. That's where they make their money. What would be
their motivation to open macOS? Do you think that macOS license sales would
provide a meaningful offset to the drop in revenues and profits?

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my123
The iPhone 7 was released at the end of the quarter, the article means exactly
nothing.

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the_economist
Same was true for the iPhone 6S, iPhone 6, iPhone 5S, iPhone 5, etc. Yet this
is the first time in 15 years Apple revenues have shrunk year over year.

That means something.

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huxley
Sure it means something, it means that Apple had a spectacular 2015.

In 2001, Apple had revenues of $5.3 billion and a net loss of $25 million.

2014, revenues of $182.8 billion with $39.5 billion in profit.

2015, revenues of $233.7 billion with $53.4 billion in profit.

2016, revenues of $215.6 billion with $45.7 billion in profit.

Apple's 2016 revenues shrunk in comparison to a peak year but it's still their
2nd best showing ever.

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the_economist
This is not telling the complete story. In 2016, Apple shrunk around 25% in
China, after growing 100% in China in 2015.

Something is very odd with their China business.

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mifreewil
I think you just agreed with the parent comment.

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Mao_Zedang
Phones are a commodity.

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samfisher83
I think the phone market should follow the PC market since the phone is much
like a miniaturized PC. However Samsung and apple have been able to achieve
high margins. Porters five forces tell us given the competition the margins
should erode.

