Following the iPhone 8 launch, there have been reports that sales are slow this time around. However, according to trusted Apple analyst Ming-Chi Kuo of KGI Securities, these iPhone 8 sales concerns are largely “overdone,” as people are awaiting the iPhone X, notes MacRumors.
Kuo thinks that the negative estimates for first-weekend iPhone 8 sales are coming simply because analysts are too dependent on the observed sales momentum in unlocked/SIM free channels such as the Apple Store, while they are ignoring the sales momentum within carrier channels. Kuo believes that iPhone 8 sales in the first weekend are on track, but he warns that the shipment momentum may not remain stable as the iPhone X nears.
“At first glance, the combined first-week adoption rate for the iPhone 8/ 8 Plus might appear low (about half that of iPhone 6s/ 6s Plus and 7/ 7 Plus). However, this is because the iPhone X is not included, not because iPhone 8/ 8 Plus first weekend sales have been weak,” Kuo says.
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According to Kuo, the iPhone 8 and 8 Plus have clocked half the number of sales the iPhone 7 and 7 Plus or even 6s and 6s Plus had right after their launches. However, the analyst believes that Apple is not worried and is expecting half its iPhone sales to come from the iPhone X, which will be released in November.
In its initial survey of Apple Stores, Mashable found that the excitement about the iPhone 8 and 8 Plus was less than the excitement was after previous iPhone models were launched. Kuo, however, notes that buyers who cramp Apple Stores are “presumably hardcore Apple fans and heavy users,” and such users don’t go for iterative phones like the iPhone 8, but rather, are waiting for the iPhone X.
Kuo expects iPhone X sales to cross the 40 million to 50 million mark with only pre-orders, according to StreetInsider.
“iPhone X is seen as the first model refresh since iPhone 6 from 2014, offering a revamped form factor design. We think Apple’s (US) core fans and some iPhone 6 and iPhone 6s users are willing to pay a hefty price for this upgraded device,” Kuo said.
Taking a cue from Kuo’s report and various other recent reports, it is now nearly confirmed that iPhone X demand is going to be robust. However, there are good chances that this demand will not be fully met due to supply constraints. One of the main issues behind the supply constraint of the iPhone X is believed to be the TrueDepth camera system, 9To5Mac reported recently. The iPhone X will have more sensors than to other phones on the market, and this why a supply disruption is believed to be imminent and mass production remains a challenge.
Citing supply chain sources, Digitimes reported recently that Apple had asked its component suppliers to slow down. Suppliers are said to be shipping enough components to make only 40% of the initially planned quantities of the iPhone X. However, the report stated that Apple did the same with the iPhone 7 as well.
In pre-market trading today, Apple shares were in the green. Year to date, the stock is up more than 32%, while in the last year, it is up almost 36%.