Apple iPhone Could Experience Decline In Sales In 2016

According to CNN Money, 896 million Apple iPhones have been sold since June 29, 2007, the day the very first iPhone was sold. But, the latest estimates from KGI Securities predict that Apple iPhone sales may be slowing down in 2016.

The new iPhone SE received a lukewarm response from Apple iPhone users when Apple released the phone. Localytics observed that the Apple iPhone SE accounted for just.01 percent of all new Apple iPhones during its initial weekend release. The Apple iPhone SE performed worse than any iPhone has performed during a first-weekend in the last five years.

Apple has designed the Apple iPhone SE for users who prefer smaller smartphones, but the device failed to resonate with its target users. The Apple iPhone SE didn’t appeal to a substantial share of iPhone 5 users, the phone the SE closely resembles. This indicates consumers haven’t been convinced to upgrade just yet.

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The Apple iPhone SE has a starting price of $399 without a contract and costs only $160 to build. According to Arik Hesseldahl, Senior Editor of Re/code, the Apple iPhone SE “represents the latest attempt by Apple to offer its customers an entry-level phone in a price band lower than its mainstream phones.”

While the Apple iPhone SE launch was a flop, the iPad Pro 9.7-inch performed better during its first weekend launch. “According to Localytics, the new iPad Pro 9.7-inch saw even better first-weekend performance compared to its sister device, the iPad Pro, and its launch last fall. The iPad Pro doesn’t follow an upgrade cycle like the iPhone and offers a flagship experience as opposed to a smaller, budget-oriented experience like with the iPhone SE,” says Joshua Sherman of Digital Trends.

Apple iPhone Could Experience Decline in Sales in 2016
Ming-Chi Kuo, a KGI Securities analyst, predicts Apple will ship approximately 200 million Apple iPhones in 2016. The company shipped 232 million Apple iPhones in 2015.

Kuo, recognized as the “most reliable industry watcher on the planet when it comes to Apple,” noted what he believes are the reasons for the decline in Apple iPhone sales. Kuo believes Apple iPhone users are not impressed with the upcoming Apple iPhone dual camera system, in addition to the decreased interest in larger displays. Combine these two things with the fact that the Apple iPhone SE doesn’t really offer anything new (unless you count the fact that it’s tiny), and Kuo says these are the reasons for the decline in iPhone shipments in 2016.

Despite Kuo’s prediction that the Apple iPhone will experience a decline in sales this year, with 896 million iPhone devices sold, the iPhone is one of the top-selling tech products of all time. And even though Apple makes the top-selling tablets, MP3 players, and PCs, the Apple iPhone has outsold all three of those products combined.

Analyst Ananda Baruah of Brean Capital believes Apple iPhone sales will fall in 2016, but Baruah is optomistic about iPhone sales in 2017.

“For the holiday quarter, Brean Capital’s forecast calls on Apple and its next-generation ‘iPhone 7’ to drive sales up to 70 million. If the prediction holds accurate, that would be a decrease from both the iPhone 6s and the iPhone 6 launches, which reached nearly 75 million units.”

“For iPhone growth, Brean Capital is looking forward to 2017, when it projects Apple will ship 237 million units. That would exceed the 232 million sold in 2015 and represent a new record for the company.”

Ashraf Eassa, a technology specialist with The Motley Fool, noted in February 2016 his optimism about the success of the Apple iPhone 7 in 2017.

Despite speculation that the Apple iPhone 7 will have new features, like a dual camera, Kuo doesn’t agree with Eassa or Baruah and doesn’t see much of a recovery for Apple in 2017.

[Image via Flickr/Kārlis Dambrāns]