For those not following Tim Cook’s tenure at Apple, things are still imploding at technology’s me too company.
5G
Remember Apple’s lack of 5G phones in 2019? The explanation finally came to light and Apple found a path forward. After being backed into the corner, Apple buried the proverbial hatchet with Qualcomm and as a result, Intel cancelled their research and development of 5G technology. So Apple will now be sporting the same Qualcomm 5G technology as Android phones only selling it for their usual high mark-up.
Apple’s settlement with chipmaker Qualcomm means it can fire up the engines on 5G iPhones.
Apple on Tuesday reached a settlement in its gnarly legal fight with Qualcomm. The dispute revolved around a royalty dispute over Qualcomm’s premium modem chips. The settlement included an undisclosed payout from Apple to the chipmaker.
Previously Wall Street analysts had voiced concerns that Apple was lagging in the race to faster 5G phones, in part due to its fight with Qualcomm.
Soon after news broke that the companies had settled, Apple’s chosen supplier for its future 5G smartphones, Intel, announced it was pulling out of the 5G modem race entirely. “It has become apparent that there is no clear path to profitability and positive returns,” said CEO Bob Swan.
Link: Apple’s blockbuster legal settlement paves the way for a 5G iPhone
Sales
Apple phone sales, year-over-year were down 30 percent. No wonder they don’t want to talk about phones any more.
Apple’s iPhone sales in China were down 30 percent during the first quarter of 2019, according to new shipment estimates shared today by Canalys.
Link: Apple’s iPhone Sales in China Down an Estimated 30% in Q1 2019, Huawei Continues to Dominate
Apple announced its financial results for its fiscal Q2 of 2019, the company’s revenue was down 5% over the previous year. Apple did not reveal how many iPhones it sold in the quarter.
According to a recent report from IDC, iPhone sales are down some 30% over the same time last year, with an estimated 36.4 million iPhones sold.
In its Mobile Phone Tracker for the first calendar quarter of 2019, IDC estimated that Apple only shipped 36.4 million iPhones, which it stated was a 30.2 percent annual drop, whittling down Apple’s share to just 11.7 percent of a total of 310.9 million global smartphones shipped in the quarter.
That figure put Apple in a distant third place behind Samsung’s nearly 72 million units and Huawei’s almost 60 million units. Because Apple sells only premium phones—as most analysts define as selling for about $400 or more—it’s not surprising that high-volume vendors of mostly lower-end phones would be outselling Apple in terms of unit sales.
However, IDC’s portrayal of more than a 30 percent drop in iPhone units over the previous year is nothing short of shocking. It’s also, as Cybart noted on Twitter, not just “embarrassing” but “impossible to achieve given Apple’s stated iPhone revenue.” Cybart stated that “IDC isn’t close with their iPhone unit sales estimate for the quarter that Apple just reported.”
Battery
In addition to being busted throttling battery life in their old phones, Apple has now been busted overstating the battery capabilities of their new phones.
Link: Apple exaggerating iPhone battery life by up to 51 percent, report says
Summary
Living for the 90-day cycle has its drawbacks and they are on full display for anyone willing to open their eyes. Clearly excellence and innovation take a backseat when you are a slave to churning-out dividends every quarter just to stay alive for the next financial report.