WSJ: Apple is shuffling deck chairs on sinking iPhone sales

Offering subsidies, shifting production, re-booting the iPhone X, sources say.

From “Apple Cuts Price of iPhone XR to Boost Sales” in Friday’s Wall Street Journal ($):

Less than a month after releasing the iPhone XR, Apple Inc. is moving to offer subsidies to mobile-network operators in Japan to shore up sales of its least-expensive new smartphone, people familiar with the matter said…

Though it has been done in the past, officials at Japanese carriers say it is rare for Apple to cut the price in their market on a recently launched handset.

“A price cut within a month of the release is rare not just for Apple but for smartphone makers in general,” said a senior official at a wireless operator, who monitors sales.

Analysts say weaker-than-expected demand for the iPhone XR may mirror what happened with the iPhone 5c in 2013, where sales picked up the following year. Apple’s higher-priced XS and XS Max models, released in September, appeal more to tech’s early adopters who typically fuel initial sales of new iPhones…

Apple suppliers have also recently resumed making the iPhone X, the 2017 model that Apple had stopped selling at its own stores, people familiar with the matter said.

People involved in the supply chain said the resumption of the X is due in part to Apple’s contract with Samsung Display, a major provider of iPhone X’s organic-light emitting diode display, or OLED, panels. Apple needs to buy a certain amount of the panels from the South Korean maker, and given the cut in XS and XS Max, Apple is trying to fill the gap with the old device, they said.

My take: Pretty damning, if true. The Journal has been wrong before, but it’s right more often than it’s wrong.


  1. David Emery said:
    I thought I saw something yesterday about how WalMart is running out of iPhones.

    The idea that Apple restarts a production line is particularly unconvincing.

    November 23, 2018
  2. Fred Stein said:

    The smash success of the XS and XS Max takes share from other iPhones.

    The XR lacks telephoto, which is available on cheaper new and used iPhones.

    Maybe XR sales are down. Apple has other products and buyback to increase EPS.

    If one believes, with religious conviction, that there must be something wrong with Apple – and many believe this – then all one needs is rumors.

    November 23, 2018
    • Dan Scropos said:
      Fred, wouldn’t it be nice to have Apple report $93 billion in revenue *and* $40-$60 billion in buybacks in late January?

      Back to your post—there’s AMPLE evidence Apple’s higher end models are once again dominating sales and virtually none that iPhone unit sales are poor. They may have simply missed (again) the product mix. More phones=increased possibility of a product mix miss.

      We’re also already hearing counter arguments about the reports out of Japan. Some are now saying these are carrier subsidies, not Apple. We’ll see.

      November 23, 2018
  3. Gregg Thurman said:
    Oh let’s see, let’s complain that iPhone prices are to high. Then let’s announce that the low cost iPhone XR isn’t selling very well so let’s restart higher priced iPhone X assembly (on the spur of the moment as though prior supply chain coordination isn’t necessary) to increase unit sales.

    The inconsistency in reason and logic boggles the mind.

    November 23, 2018
  4. Aaron Belich said:
    When was WSJ right about anything Apple since Steve Jobs passed away, because that’s something they can’t really dispute?

    November 23, 2018
  5. John Konopka said:
    Hard to believe that once they stopped it they could easily start making iPhone X again. This is not like switching on an ink jet printer.

    November 23, 2018

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