Apple iPhone sales likely to decline for second consecutive year due to lack of new model
Apple's iPhone sales is expected to decline for the second consecutive year. According to KGI's Ming-Chi Kuo, Apple is estimated to ship only 40-50 million units of iPhone in the first quarter of 2017. Kuo is conservative about the sell-through of the 4.7-inch iPhone and Apple's market share in China. The new forecast by KGI also predicts that Apple will not release an update to iPhone SE next year.
Apple's iPhone shipments rose in 2016 primarily because of the upbeat demand for the iPhone SE. iPhone SE was introduced primarily to appease the audience who were sticking to their iPhone 5S or older product because of size. With iPhone SE, Apple offered the hardware found on iPhone 6s, in a smaller 4-inch form factor.
According to Kuo, Apple won't update the iPhone SE next year in order to maintain the grown margin and avoid cannibalisation of high-end models. "Without contribution from a new model, we forecast total iPhone shipment volume will reach 35-40mn units and fall YoY in 2Q17, lower than the 40.4mn units in 2Q16," reports 9to5Mac. The decline in sales may force Apple to put pressure on its suppliers to reduce costs starting this month or the next, says Kuo. Apple is likely to force panel makers to reduce cost, while Samsung (the major supplier for RAM and flash memory) might raise price owing to lower production yields.
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