Apple Reports A Big Miss On iPad Sales
Apple announced Wednesday its iPhone and iPad sales for the first quarter of 2014.
Here's the score:
iPhones: 43.7 million units vs. 37.7 million units expected by analysts.
iPads: 16.35 million units vs. 19.7 million units expected by analysts.
That's a huge miss on iPad sales, and just another demonstration of how growth in Apple's tablet business has stalled.
But it was a beat on iPhones. Analysts expected Apple to sell fewer iPhones last quarter because we were coming off the holiday quarter.
Apple said the average selling price for iPhones last quarter was $596. That number gives us a hint as to what kinds of models Apple sold the most. The iPhone 5S retails for at least $649, so Apple mostly sold cheaper iPhones like the iPhone 4S and iPhone 5C last quarter . Apple's cheaper iPhones seem to be more attractive to consumers than its top-of-the-line models.
The iPad business is in big trouble though with negative growth. (See chart below.) The theory is that people aren't buying iPads because they don't upgrade them as often as they do iPhones. There are also a lot of competing tablets from companies like Amazon, Samsung, and Google that are much cheaper and do most of the same stuff.
Apple CEO Tim Cook said on a conference call with analysts that iPad sales were in line with the company's own internal expectations. He said the reason why the sales may have seemed lower than analysts expected is because the company reduced iPad channel inventory this quarter.
As for the iPhone, things are going strong. It's up 17% year over year.
There's no doubt about it. Apple is an iPhone company. Everything else is just gravy.
Here are some charts breaking it all down.
And iPad sales:
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