Apple to post its first quarterly revenue decline since 2003 | Hacker News Reader

Apple to post its first quarterly revenue decline since 2003

recode.net

42 pointsbaldfat24 comments

From my perspective as an Apple fan and consumer, when I look at the current iPhone 6S offering and the current Macbook product lines, I feel as though Apple's value proposition is eroding.

It wasn't long ago when I would have considered it silly to purchase last-gen Apple products. Today it doesn't seem silly at all. Although, I am a little sore about the current state of the Macbook product line and I hope that Apple really knocks it out of the park this summer or fall with an updated suite of products, particularly in the realm of a lightweight 13" retina offering.

Apple is expected to report that March quarter sales declined 10 percent year over year to around $52 billion

What's the reason for the iPhone sales shrinking? Cheaper competition has been around for many years.

Smartphone saturation - the whole market is slowing, though particularly in the US and China where iPhone marketshare or growth is strong.

http://www.pcworld.com/article/3027008/smartphone-growth-at-...

http://www.usatoday.com/story/tech/2015/10/29/smartphones-sa...

http://www.telegraph.co.uk/technology/mobile-phones/11812322...

While the iPad seems to have stalled on its own significantly, this doesn't seem to be an iPhone-specific trend (yet)

No new markets, coupled with lack of upgrades.

If you have a 5, there's no compelling need to buy a 6x because from a user pov it's just more of the same.

Under Cook, Apple has iterated on faster/thinner/bigger/smaller/blingier, and there's been no significant original thinking.

The execution is great, in a slightly wobbly way, but what's being executed has become formulaic, mundane, and unexciting.

Ok, not arguing just trying to understand better. Surely people are still upgrading. Perhaps it's less frequent? Like, now people are waiting their full upgrade period (or longer) whereas before many upgraded frequently?

We've also seen the shift away from 2-year contracts here in the USA. People are now aware that phones actually cost $600+ and are either paying full price, or monthly installments to pay off the $600 phone they bought.

Yeah, that's an interesting observation. I've long thought that Apple benefited from the 2-year contract model more than any other manufacturer. The 2-year contract hides the actual cost of the phone, so an iPhone sells for $199 just like an LG. Who buys a Honda when a Mercedes costs the same?

Buying a phone for its real price puts the cost/benefit front and center to the consumer. Maybe an iPhone isn't worth an extra $200 after all? This puts Apple in a bind as they either have to drop the phones price or provide greater value for their price point.

> "Under Cook, Apple has iterated on faster/thinner/bigger/smaller/blingier, and there's been no significant original thinking."

This is lazy thinking, based on Jobs being an 'innovator' and Cook being focused on refinement. What exactly makes the iPad more innovative than, let's say, the Apple Watch?

Turns out nothing, but somehow Jobs was able to convince you that by not owning an iPad you were missing out on something big.

It's shrinking (slightly) year-over-year because the iPhone 6 was a blockbuster--people were waiting for larger-screen iPhones and jumped to upgrade when the 6 came out. The 6 was also supply-constrained which pushed some of those sales into the year-ago quarter. The 6s has done fine, but is not the anomaly that the 6 was. Wall Street will react violently to all this, but I think Apple and the iPhone business are still fundamentally healthy and sound.

The same reason why PC sales are shrinking; the reasons for upgrading every year are much less compelling, and old phones are still pretty adequate.

Do we know the impact of the new iPhone pricing models where people pay Apple a monthly installment? Is it just a wash? At first glance, it seemed like this was increasing Apple's take.

It doesn't change the amount of money Apple gets. The carriers still were buying the phones from them at wholesale or full price, and just subsidizing the upfront cost of the phone by selling it at $199 to the customer but baking in the rest of the phone into their monthly voice/text/data plans.

I don't think OP is referring to getting the phone from your carrier, they're referring to the 'iPhone Upgrade Program' where you pay Apple a monthly installment and get a new phone every year: http://www.apple.com/shop/iphone/iphone-upgrade-program

It's financed through Citizen Bank, so odds are Apple is being paid in full (or at least most of it) up front.

Whichever it is, wondering if it's improved (or not) economics to Apple.

They'll likely put a lot of emphasis on their services number(s), which is growing substantially.

if you think the 5% drop market cap in Google and MS last week was big you ain't seen nothing yet. Everyone's getting a haircut.

Stock down 7% in after hours trading.

what goes up must come down at some point..

Maybe Elon Musk can establish civilization on Mars before Apple can sell an iPhone to every man woman and child on Earth.

The annoying thing is all the pundits predicting Apple doom for the last 9* years will all be saying "I told you so!".

* Make that 19# years

# Actually, make that 32 years

So about as long as people have predicted an Apple television ;)

from a philosophical perspective there simply must be a limit at which a corporation can grow. maybe they reached it.

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