Apple’s upcoming iPhone X will be its biggest in years, but will still fall short of sales expectations.
This is according to Edison Investment Research analyst Richard Windsor, who today likened the looming iPhone X launch to the 2014 unwrapping of the iPhone 6 and 6S. Like that blastoff, the iPhone X introduces a new design to Apple’s smartphone and with it more hardware features and the need to adapt software.
Where the two handsets – the X and the 6 – will differ, said Windsor, is in their sales. The iPhone 6 caused iPhone shipments to climb by 46 per cent and 40 per cent, year on year, in its first two quarters on the market, and 35 and 22 per cent in the third and fourth quarters, respectively.
By comparison, Edison only projects the iPhone X to be a modest push to sales with shipments going up by 15 to 22 per cent in its first four quarters.
“This is due to utility, as while the new screen is nice to look at and enables a big screen on a smaller device, it does not offer an increase in utility over the iPhone 7 similar to that of the iPhone 6 compared to the iPhone 5,” explained Windsor.
“Consequently, it will not create the same degree of desirability and therefore not trigger a similar degree of early replacements compared to the iPhone 6/6 Plus.”
Further complicating matters, said Windsor, is the already large market share Apple has, with fewer people looking to get a new smartphone, Apple has less headroom to grow sales. This, combined with the eye-watering $999 starting price for the iPhone X, means there are only so many people who will be able to buy the new model when it hits the market next month.
Windsor’s estimate suggests the iPhone X would top off at around 245m units shipped, short of the 255m that analysts have projected. Falling short of those projections could, in turn, hurt Apple’s stock price.
While those buying the iPhone X won’t much care about share price (assuming they’re not Apple shareholders) a stock price drop would put more pressure on Cook and co. to manage expectations with other upcoming product releases. ®
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