- Apple continues to struggle with its new line of smartphones, the Apple iPhone XR.
- Apple analyst Ming-Chi Kuo says part of the blame for the slow XR sales is competition from Huawei.
- Apple’s stock dropped yesterday when news broke that one of its main suppliers reduced its outlook for the rest of the year, citing reduced orders from one of its biggest customers.
The Apple iPhone XR is supposed to be the somewhat-budget-friendly alternative to the company’s ultra-luxury iPhone XS and iPhone XS Max models. The iPhone XR is also — whether Apple wants to admit it or not — the company’s answer to the influx of powerful-but-affordable Android devices.
However, the iPhone XR doesn’t seem to be doing too well right now. Apple — for the first time ever — refused to release sales numbers for the XR, XS, and XS Max during its recent earnings call, but other industry sources point to the new iPhones (and the XR in particular) not meeting sales expectations.
Popular Apple analyst Ming-Chi Kuo originally slated the iPhone XR as being a big seller. However, now he is changing his tune (via iPhone Hacks), dropping his shipment estimates by 30 percent.
Kuo believes part of the reason for the iPhone XR’s slow sales is competition from Chinese manufacturer Huawei, specifically the company’s newest Mate 20 lineup. Although this isn’t the case in the United States (where Huawei smartphones have a minuscule market saturation), Huawei is giving Apple a run for its money around the rest of the world.
When you think about it, this theory makes sense: the Mate 20 series and the new iPhones were launched right next to each other, and the price points for the Mate 20, Mate 20 Pro, and Mate 20 X stand up very nicely against the iPhone XS, iPhone XS Max, and iPhone XR respectively. However, the Mate 20 series offers more of what consumers want, like multiple camera lenses, small bezels, and interesting color options.
Yesterday, Apple’s stock took a dive when it was revealed that Lumentum — Apple’s principal supplier of facial recognition sensors — had slashed its revenue outlook for the year. While Lumentum didn’t mention Apple by name when it explained the lowering of its estimates, it did say it received a request to “reduce shipments” from one of its “largest Industrial and Consumer customers.” Just read between the lines there — Apple investors clearly did.
Although it’s too early to say for certain, it does seem the iPhone XR is going to go the way of the iPhone 5C, a previous failed attempt by the company to release colorful iPhones with lower price points to appeal to cash-conscious consumers who normally flock to Android.