January 26, 2016: After 9 years of spectacular progress, iPhone gross sales flatline for the primary time. Some name the gross sales plateau means “peak iPhone” has lastly arrived.
Numbers posted by Apple present that throughout the remaining three months of 2015, iPhone gross sales grew by solely 0.4%. The essential vacation season gross sales examine fairly unfavorably with the 46% leap recorded throughout the identical interval a 12 months earlier.
Fears of ‘peak iPhone’ as gross sales plateau
When the first iPhone arrived in 2007, it modified the sport for smartphones. And with every subsequent mannequin, Apple bought extra iPhones than the 12 months earlier than. However that phenomenal gross sales trajectory couldn’t go on for ever.
For years, analysts questioned when Apple would hit “peak iPhone.” In 2016, for the primary time, it appeared the reply is perhaps “now.” Apple bought 74.8 million iPhones throughout the interval, up from 74.46 million within the fourth quarter of 2014.
The fault for the iPhone gross sales plateau didn’t essentially lie with Apple, though the iPhone 6s was arguably the least thrilling improve in years (even by “s” launch requirements). As a substitute, the iPhone droop had loads to do with slowing worldwide progress for smartphones. Total smartphone gross sales sank to their lowest degree since 2013, in accordance with researchers at Gartner.
This proved true in america and different mature markets, the place fewer individuals had been shopping for their first smartphones. Apple subsequently focused on catering to its present buyer base, in addition to no matter customers it may steal from rivals.
The smartphone slowdown additionally hit China, which Apple touted as its future greatest market. Apple CEO Tim Prepare dinner famous that, whereas Cupertino made nice strides within the Asian nation, the corporate “began to see some financial softness in better China in current months, most notably in Hong Kong.”
Different Apple merchandise don’t assist a lot
The truth that Apple didn’t create a brand new hit product class to choose up the slack solely compounded the height iPhone downside. And different Apple product strains declined, too. The corporate bought 4% fewer Macs and simply 16.1 million iPads within the quarter (down from 21.4 million in the identical interval in 2014). The Apple Watch and Apple TV, in the meantime, generated only a fraction of Apple’s whole income. Consequently, Cupertino handled them extra like hobbies than potential iPhone-beaters.
Apple did publish report revenues for the quarter. Nevertheless, this marked a pattern that continued, as the corporate’s meteoric rise throughout the early 2000s started to lose momentum.
Nowadays, Apple more and more leans on providers like Apple Music, iCloud, Apple Arcade, Apple Card, Apple Information+ and Apple TV+ to assist make up for stalled iPhone gross sales. The corporate additionally continues to jack up the worth of its flagship telephones, which additionally boosts income.
Peak iPhone … NOT
From right now’s perspective, the concept 2015 was “peak iPhone” is clearly ridiculous. Market analysis exhibits Apple shipped 88 million iPhones within the fourth quarter of 2020, and 85 million in the identical quarter a 12 months later. That’s way over in This autumn 2015. And whole shipments throughout all of 2021 confirmed an 18% year-over-year improve.
That stated, iPhone progress in america, Europe and different rich nations relies on individuals switching from Android. The variety of individuals shopping for their first smartphone annually is even decrease than again in 2015. As of 2024, Apple reportedly commanded 18.7% of worldwide smartphone gross sales.
Additionally on this present day in Apple historical past…
Whereas the announcement of slowing iPhone gross sales (and associated fears of hitting peak iPhone) might be a very powerful Apple occasion to happen on January 26, it’s enjoyable to make use of these “At present in Apple historical past” posts to look again a bit additional.
On January 26, 1999, Apple reached a settlement with the Federal Commerce Fee to reimburse prospects who had been charged for technical help that an “Apple Assurance” advert marketing campaign stated would all the time be free.
The Apple Assurance was a promise made by Apple from 1992 to 1996 that free entry to technical help personnel would all the time be out there so long as the patron (or a member of their household) owned an Apple product. Quickly after Steve Jobs returned to Apple, the corporate scrapped this coverage. From October 1997, Apple started charging prospects a $35 price for entry to help.
Ultimately, Apple agreed to ship a Discover of Refund to each person concerned within the disagreement. This included a verify or bank card reimbursement notification to everybody who beforehand paid for technical help providers.