Cook said Apple expects revenue of $84 billion for the quarter, almost a tenth lower than the consensus expectation in financial markets.
Apple acknowledged that demand for iPhones is waning, confirming investor fears that the company's most profitable product has lost some of its luster.
The reckoning came in a letter from Apple CEO Tim Cook to the company's shareholders released after the stock market closed Wednesday.
Cook said Apple's revenue for the October-December quarter—including the crucial holiday shopping season—will fall well below the company's earlier projections and those of analysts, whose estimates sway the stock market.
Apple now expects revenue of $84 billion for the period. Analysts polled by FactSet had expected Apple's revenue to be about 9 percent higher—$91.3 billion. The official results are scheduled to be released Jan. 29.
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So just where does this leave Apples new iPads
Tablet sales are in free fall. In fact, they’ve been falling for a long time. When Apple launched the first iPad in 2010, it was a roaring success – creating a new product category virtually from scratch, and shipping millions of units.
But according to analysts the market peaked in 2014, when 250 million tablets were shipped worldwide. Since then, sales have been on the slide for 16 quarters in a row – almost half the time tablets have existed. They fell more than eight per cent in the third quarter of 2018.
“At the end of this year we’ll see revenue numbers that are equivalent to 2011,” says Tom Morrod, senior research director at IHS Markit. The slump is even reflected on social media, where conversation peaked around the launch of two new iPad models in 2014, and has fallen off since then, according to analytics firm Crimson Hexagon.
Part of the problem is that for most tablet owners, there’s not really a compelling reason to upgrade. “The trend is that tablet users were not really renewing their device,” says Daniel Goncalves, a senior research analyst at IDC. “The device they had was good enough for their daily needs – streaming, video and television.”
“They’re a nice to have, not a must have,” agrees Chase Buckle of GlobalWebIndex. His company’s data – collected from internet users aged 16-64 – shows that only nine per cent of tablet owners rank tablets as the most important device for accessing the internet.
In some ways, tablets have been the engine of their own demise. The first wave of devices, sparked by the launch of the iPad, demonstrated that consumers had an appetite for larger screen sizes, says Morrod. So smartphones got bigger and bigger, and started squeezing out demand for their larger brethren.
Apple acknowledged that demand for iPhones is waning, confirming investor fears that the company's most profitable product has lost some of its luster.
The reckoning came in a letter from Apple CEO Tim Cook to the company's shareholders released after the stock market closed Wednesday.
Cook said Apple's revenue for the October-December quarter—including the crucial holiday shopping season—will fall well below the company's earlier projections and those of analysts, whose estimates sway the stock market.
Apple now expects revenue of $84 billion for the period. Analysts polled by FactSet had expected Apple's revenue to be about 9 percent higher—$91.3 billion. The official results are scheduled to be released Jan. 29.
===================================================================
So just where does this leave Apples new iPads
Tablet sales are in free fall. In fact, they’ve been falling for a long time. When Apple launched the first iPad in 2010, it was a roaring success – creating a new product category virtually from scratch, and shipping millions of units.
But according to analysts the market peaked in 2014, when 250 million tablets were shipped worldwide. Since then, sales have been on the slide for 16 quarters in a row – almost half the time tablets have existed. They fell more than eight per cent in the third quarter of 2018.
“At the end of this year we’ll see revenue numbers that are equivalent to 2011,” says Tom Morrod, senior research director at IHS Markit. The slump is even reflected on social media, where conversation peaked around the launch of two new iPad models in 2014, and has fallen off since then, according to analytics firm Crimson Hexagon.
Part of the problem is that for most tablet owners, there’s not really a compelling reason to upgrade. “The trend is that tablet users were not really renewing their device,” says Daniel Goncalves, a senior research analyst at IDC. “The device they had was good enough for their daily needs – streaming, video and television.”
“They’re a nice to have, not a must have,” agrees Chase Buckle of GlobalWebIndex. His company’s data – collected from internet users aged 16-64 – shows that only nine per cent of tablet owners rank tablets as the most important device for accessing the internet.
In some ways, tablets have been the engine of their own demise. The first wave of devices, sparked by the launch of the iPad, demonstrated that consumers had an appetite for larger screen sizes, says Morrod. So smartphones got bigger and bigger, and started squeezing out demand for their larger brethren.
