Apple Will No Longer Report Hardware Sales Figures

Posted on November 2, 2018 by Paul Thurrott in Apple, iOS, Mac and macOS, Mobile with 29 Comments

Signaling that its the era of unit sales growth has come to an end, Apple this week said that it would be much less transparent about device sales.

News of the change came during Apple’s financial results conference call, and after the firm had warned that the current quarter would be soft, sending Apple shares plummeting.

“Starting with the [current] quarter, we will no longer be providing unit sales data for iPhone, iPad and Mac,” Apple CFO Luca Maestri said during the call. “As we have stated many times, our objective is to make great products and services that enrich people’s lives, and to provide an unparalleled customer experience so that our users are highly satisfied, loyal and engaged.”

“As we accomplish these objectives, strong financial results follow,” he continued. “As demonstrated by our financial performance in recent years, the number of units sold in any 90-day period is not necessarily representative of the underlying strength of our business.”

I’d argue otherwise: In recent years, the number of devices sold was very much tied to the company’s financial performance. The sole outlier, and, granted, it has gotten bigger and bigger in recent quarters, is Apple’s Services business. Which hit a record $10 billion in revenues in the most recent quarter.

But Apple’s decision to be less transparent about its unit sales is tied to the strategy I discussed in Apple Jacked (Premium): With device sales stagnating (iPhone) or even falling (iPad, Mac) each year now, Apple has been forced to raises prices across the board as part of an effort to further monetize each customer. It’s Services business is the other half of that strategy.

Put another way, this is Apple taking advantage of the natural momentum or inertia that comes from having such a healthy business. It no longer needs explosive unit sales growth in order to grow financially. All it needs to do is keep sucking the life blood out of its billions of loyal customers.

It’s a good strategy. But as someone who values real-world data and metrics, I mourn this decision just as I complain when Microsoft does the same thing in its own earnings. These are humongous companies that should be beholden to the requirements of their shareholders. And that should include transparent reporting of sales data that can be used to make the right investment decisions.

Ah well.

 

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Comments (29)

29 responses to “Apple Will No Longer Report Hardware Sales Figures”

  1. Avatar

    gardner

    I fail to see how suppressing information benefits Apple's owners (their stockholders). It only seems to serve management's interests at the cost of providing complete information to those that own the company, and it makes it difficult for owners to evaluate the job management is doing.

    • Avatar

      jcbeckman

      In reply to gardner:

      As a shareholder I agree. This is obviously just a ploy to not have to report lower year-over-year results.

      • Avatar

        red.radar

        In reply to jcbeckman:

        I disagree. This is just a signal that the business / market has changed. They will still provide information to their sales and profit growths. However the sources are going to change.


        you will probably see data that says “hardware or legacy”. And it will be this relatively flat baseline. They will report the growth sectors on top of that base. Ie the services and new ventures.


        It’s a necessary change and management of information to keep retail investors calm. I fully support it as most anyone can clearly see the tech sector “technology” is stagnating it’s all about the services they can build on these platforms

    • Avatar

      Jason Peter

      In reply to gardner: I fail to see how suppressing information benefits Apple's owners (their stockholders). It only seems to serve management's interests at the cost of providing complete information to those that own the company, and it makes it difficult for owners to evaluate the job management is doing.


      Agreed. I’m just glad Microsoft and the vast majority of other tech manufacturers don’t resort to hiding their unit sales figures from their lucky stockholders... /s

    • Avatar

      ebnador

      In reply to gardner:

      I kind of disagree. As a share holder not on the board, I'm not in charge of strategic direction (neither is the board, but they can hire someone that agrees with their view of the direction). My only interest is to get a return on my investment, by the company growing and making money. If that is through unit sales or sales of additional services is not my decision.

      That being said, I don't think they can keep raising prices to keep the revenue steady. The more expensive an iphone is the longer people are going to keep it and not upgrade, or move to a cheaper alternative.

  2. Avatar

    ayebang

    It is because iPhone will be sold too much or too bad in the near future ?

  3. Avatar

    red.radar

    Just another sign technology sector in the economy has stagnated. It’s about the services now. Makes me sad as a hardware engineer. Means we are destined for incremental updates for quite some time. Also we will probably see some blockbuster mergers


    I wonder how long before Apple launches it’s own search efforts....

  4. Avatar

    melinau

    It seemed pretty clear to some of us after the iPhone really took off, that Apple's long-term strategy would be to focus on "Services".

    They've clocked-up gargantuan hardware sales increases year-on-year since then, but now the inevitable plateau has been reached, or is at least close. I'm confident that Steve Jobs and his then team planned this out pretty carefully - the much-criticised "Walled Garden" is now producing serious payback as hardware sales continue to stagnate.


    Apple doesn't need hugely to increase its user-base, but it does need to keep them loyal.

    Apple is becoming synonymous for mediocre hardware upgrades, hackneyed, banal design and les than stellar software quality & hardware reliability, Despite this the faithful still come to pray at the Church of Jobs, which means that the early strategy was spot on.

    In UK a brand of Beer has the tag-line "Reassuringly Expensive" it, like Apple has good sales, and engenders substantial brand-loyalty, despite having little to differentiate it from cheaper, arguably superior alternatives.

  5. Avatar

    irfaanwahid

    Just a thought.. they cannot forever keep raising the prices for its products. There will be a point where users will not find it worth paying for a phone say, starting price of $1500 or 1700.

    Apple's strategy of keep raising price should hit a boiling point sometime.

    • Avatar

      locust infested orchard inc

      In reply to irfaanwahid:

      You are correct in your analysis, however before the arrival of the price "boiling point" you allude to, Orchard Inc. will have released the chimeric iFold, part iPharce, part iFad – a foldable Apple iDevice expected in 2020, and probably retailing for above $2000.


      That will drive revenues up, AAPL shares will climb, bringing renewed investor confidence.


      I suspect the entity that emblazons a part-bitten logo on its iDevices shall remain the darling of investors for at least another eight years from the release of the iFold.

    • Avatar

      shameermulji

      In reply to irfaanwahid:

      It isn't like Apple's been continually been raising prices forever. they started it a year ago beginning with the iPhone X and there's no guarantee they will keep doing it every year. How about we wait till the next round of product updates / introductions to find out.

      • Avatar

        locust infested orchard inc

        In reply to shameermulji:

        Tell us the price of the iPharce 3G when it launched in the Summer of 2008 ?


        Let me provide you with the figures – $599 (free of network contract).


        The incremental price hikes over the decade is testament that you failed to spot the egregious pricing strategy.


        But don't feel too bad, for there are hundreds of millions of iSheeple who have had wool (sheared from you lot) pulled over their eyes. You are not alone in being deceived by the masters of instilling the practice of idolatry amongst its faithful herds.

        • Avatar

          Jason Peter

          In reply to locust infested orchard inc: Let me provide you with the figures – $599 (free of network contract).


          For a base unit with 8 gigs of storage, low-res screen, and a fraction of the functionality that current phones have. If anything, the argument can be made that the 3G was too expensive for what it offered.

          From this perspective, the starting price of $749 for the 64 gig XR is a steal. And for $50 more, 128 gig, which IMO is the sweet spot.


          BTW “iSheeple” was already dull and unoriginal 15 minutes after it was first written - which was likely before you were born...

  6. Avatar

    iPhoneX

    So verily, the end of manipulating APPL with unit sales has ended.

  7. Avatar

    shameermulji

    Disagree.


    In a mature / saturated market, unit sales becomes irrelevant because you only grow so much. This is where the size and strength of the total user base becomes a more important with respect to Apple’s ability to grow in other areas like services and accessories. This is not reflected in yearly unit sales.


    What I’d like to see Apple provide are numbers indicating the size of the installed base for iPhone, iPad, Mac, Watch.

    • Avatar

      Jorge Garcia

      In reply to shameermulji:

      The problem is that for Apple, their user base, for all intents an purposes, STARTS with an iPhone purchase that sucks them into the ecosystem and latches on hard. I can't see too many people opting for an Android, then purchasing a Mac and/or a HomPod afterwards. iPads, ok, yes...because the cheaper iPads especially make great babysitters for the children of even poorer folks.

  8. Avatar

    GT Tecolotecreek

    Can someone post a link to the Surface unit sales numbers for Microsoft's just closed quarter? I looked over the investor relations page and didn't see them. Love to see the Go and laptop unit sales numbers.

  9. Avatar

    Travis

    They should report on monthly active icloud users ?

  10. Avatar

    NT6.1

    So they're giving up trying to look good. You can't keep the sales up with the same half baked designs...

    • Avatar

      rbgaynor

      In reply to NT6.1:

      They posted quarterly revenue of $62.9 billion, an increase of 20 percent from the year-ago quarter, and quarterly earnings per diluted share of $2.91, up 41 percent. I'd say they are keeping up with sales just fine.

  11. Avatar

    TEAMSWITCHER

    You describe this as customers getting milked. The reality is that Apple's premium products are delivering "best in class" features for those premium prices. The cameras on the iPhone XS and XR have been well received, as with the OLED and "Liquid Retina" displays. Raw performance of these devices are superior to everything else thanks to the A12 processor. Apple has now replicated this for the new iPad Pro and it's A12X processor, 120 Hz displays, and new Apple Pencil. No Android tablet is even in the same league ... honestly. Finally, Apple backs this up with years of OS support, completely unmatched by their competition.


    Apple's MacBook Pro was in serious trouble. Questionable features (Touch Bar and Butterfly Keyboard switches) have not been well received. Thankfully, recent processor upgrades have delivered impressive performance gains, along with larger RAM and SSD capacities, all while retaining good battery life. Apple has managed to squeak out another generation of professional laptops for people that depend on these devices .. like me .. it's my "Daily Driver". But what's next? The future is far from certain. Apple has a ton of work to do.

  12. Avatar

    MikeGalos

    Which really means that Apple is giving up their channel to put up counter-arguments on speculation based on things like the numbers generated by sites like NetMarketShare.

  13. Avatar

    beckerrt

    ASP for each device is about all we'll get going forward, I guess. Fun while it lasted!

  14. Avatar

    Jorge Garcia

    Peak Apple has finally arrived. Now it is just going to be Apple figuring out how to squeeze more juice from their existing sucker, er customer base. But there's a sucker born every minute, so they're going to be just fine for a good, looooong time...unfortunately.

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