WASHINGTON – Is Apple loosing its grip on the smartphone market? On Tuesday Apple reported a slight drop in quarterly iPhone unit sales to 50.8 million units, from 51.2 million units a year earlier. Analysts, on average, had expected it to sell 52.2 million in the fiscal second quarter that ended April 1.
Even though Apple sold fewer iPhones, it made more money because of demand for its pricier iPhone 7 Plus. The iPhone’s average selling price was $655 in the quarter, up from $642 a year ago.
iPhone revenue rose 1 percent to $33.2 billion, benefiting from the iPhone 7 Plus. That model included a newer, better camera than its predecessors and its smaller sibling, the iPhone 7. Apple CEO Tim Cook called iPhone 7 Plus demand “robust” and admitted that Apple didn’t correctly predict just how many people would opt for the bigger phone over the iPhone 7.
“It took us a little while to adjust all the way back through the supply chain and to bring iPhone 7 Plus [availability] into balance, which occurred … early this past quarter,” Cook said.
When UBS analyst Steve Milunovich asked about a recent 451 research survey which found that iPhone purchase intent is at a nine-year low, Cook addressed the question head-on.
“I only glanced at it and so I haven’t had time to study it,” Cook said. “But in general, we’re seeing what we believe to be a pause in purchases on iPhone, which we believe are due to the earlier and much more frequent reports about future iPhones. And so that part is clearly going on, and it could be what’s behind the data. I don’t know, but we are seeing that in full transparency.”
According to The Guardian, analysts on average expect the company to sell 42.31m iPhones in the current quarter, according to FactSet.
Earlier in the day, Apple’s market capitalization briefly topped its peak market value of $774.91bn to reach $776.59bn. It remains the only US-listed stock with a market value of more than $700bn.