Since the past year, the Cupertino giant is struggling with a decline in iPhone sales. There are many reasons behind such a drop in the overall sales of the iPhones. Many analysts and even the CEO of Apple, Tim Cook has confirmed about the fall in iPhone sales due to some reasons. The issues such as lack of innovation, trade wars, pricing, and strong competition are major speed breakers in Apple’s path to growth. Today, an analyst from Sanford C. Bernstein has agreed with Apple’s CEO Tim Cook on another reason which is impacting the iPhone sales.
As per the Bernstein’s Toni Sacconaghi, the upgrades for longer and regular periods on iPhones has resulted in sluggish sales this year. Apple has stretched the official upgrade period of an Apple iPhone from 3 to 4 years in the fiscal year 2019. Further, Apple’s discounted battery replacement campaign even deepened the crisis. The old iPhones with a new battery has made them long-lasting. Even though, fewer subsidies and offers on the carriers have also led the decline in iPhone sales. He said, “In our view, the single most important controversy surrounding Apple today is the iPhone replacement cycle – despite the iPhone installed base growing +9% last year, we now expect units to be down -19% in fiscal 2019, implying a material pushout in upgrade rates.”
In January, Tim Cook cited that the longer upgrade cycles are making 15% iPhone sales to dip. In actual he said, “Our customers are holding on to their older iPhones a bit longer than in the past,” further adding “When you paired this with the macroeconomic factors particularly in emerging markets, it resulted in iPhone revenue that was down 15 percent from last year.”
As per Toni Sacconaghi prediction, Apple will continue to fall this year also. The Cupertino giant will witness 19% fall in the 2019 fiscal year against the expected growth of 16%. He estimated that currently, 900 million active iPhones are in the market. It would not be possible to give exact figures as “modeling iPhone’s installed base is as much art as science, with myriad assumptions.”
As per the analyst, many iPhone 6 series users will replace their phones this year.
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