New predictions from two separate analyst reports paint a picture of modest success for the alleged four-inch revamped "iPhone 5se/iPhone 6c" model Apple may unveil next month, but a more dismal picture of continuing drops in iPad sales, despite the supposed introduction of a mid-cycle "iPad Air 3" to help spur interest. Amit Daryanani of RBC Capital Markets believes that the rumored refreshed four-inch iPhone could add a gain of about 10 million units across fiscal 2016, while the often-unreliable
DigiTimes says Apple will ship fewer than 9.88 million iPads in calendar Q1 2016 for the first time since mid-2011.
Sales of a new four-inch iPhone model, particularly if it is priced around $550 without contract and aimed mostly at developing markets, could prove another inducement for Android switchers in those areas as well as encourage customers still using the smaller, older iPhone models out of personal preference to upgrade -- potentially
adding $5.5 billion to Apple's coffers over the fiscal 2016 year, which ends in September. While a metaphorical drop in the bucket (around two percent) compared to sales of its larger iPhones, the estimate represents new sales with some cannibalization factored in, says Daryanani -- in short, additional revenue rather than a portion of the existing revenue.
His prediction ties in with yesterday's move by Apple to discontinue the iPhone 4s and 5c, which were still being sold in India, and could mean that the rumored new four-inch device is intended less for the US market and more for areas like India and China, which require a less-expensive iPhone due to lower average incomes. The important change said to be included in the "iPhone 5se" or whatever it ends up actually being called compared to the existing (and still sold) iPhone 5s would be the inclusion of support for Apple Pay and Touch ID, which is coming to China later this week and may turn up in other developing markets later this year, along with improved LTE support.
RBC Capital Markets is, as a result of what it deems "a modest positive impact" projected by sales of the alleged device on Apple's bottom line, maintaining its "outperform" rating on AAPL, and holding on to its target price of $130 per share, which would be close to the all-time record share price for the company. Apple is supposedly planning to unveil the new device at an event said to be on March 15, alongside the updated "iPad Air 3" model.
On the subject of iPads,
DigiTimes Research believes Apple will
only ship 9.8 million units in the next fiscal quarter, which ends on March 31 and the results of which won't be confirmed until mid-April. The site, which has a reputation for wild guesses but occasionally hits the mark, believes Apple will sink to just 21 percent of worldwide tablet shipments -- still the leading brand, and shipping a third more units than rival Samsung, but representing a 39 percent decline from last quarter and 20 percent decline year-over-year.
This would be despite the apparent success of the company's latest iPad model, the iPad Pro, which already accounts for more than 12 percent of all iPad sales despite not having been available for the full quarter in the last cycle. The latest iPad, which is considered by analysts as a "detachable" akin to Microsoft's Surface line, outsold the entire array of Surface tablets combined during the holiday quarter. IDC Research Director Jean Philippe Bouchard said that the firm believes that "Apple sold just over two million iPad Pros, while Microsoft sold around 1.6 million Surface devices, a majority of which were Surface Pro and not the more affordable Surface 3."
The iPad Pro, which is aimed towards artists and enterprise users and thus is less dependent on holiday-quarter sales, could help bolster or lessen the potential drop predicted by
DigiTimes, while the rumored iPad Air 3 -- should it appear at all -- will arrive too late in the quarter to make a material impact on fiscal Q2, but could help nullify further sales drops for fiscal Q3. Sales of the iPad have declined more gently over the last two years, dropping 10 percent in 2015 compared to 2014.
In addition to the new four-inch iPhone model and the previously-skipped (and expected to be minor) iPad Air 3 refresh, the alleged March 15 event is also rumored to showcase some minor developments for the Apple Watch, including possible new bands, new clock faces, and possibly new partnerships with fashion houses along the lines of the Apple Watch Hermés, which was the company's first co-branded product in the line.
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