14 DAY TRIAL // Demand for the iPhone X is dropping, according to people close to the matter, and now a new note from Nomura Instinet claims the high price of the device is one of the main reasons Apple is losing ground these days.
Even though sales of the iPhone X were originally expected to recover in the first months of 2018, now it turns out this isn’t happening, and analysts expect the decline to continue later in the year.
“Our demand checks suggest little improvement in iPhone demand in 2018. Corresponding supply chain downticks suggest iPhone expectations have yet to bottom,” analyst Jeffrey Kvaal was quoted as saying.
One particular highlight in the investor note concerns the price of the iPhone, which is considered to be the main catalyst responsible for the decline.
“Market elasticity is falling,” the analyst explains, and this means that customers are no longer willing to pay so much for an iPhone. The more expensive the iPhone X, the fewer buyers for the device, and since Apple has always been aiming for a premium, it’s the biggest company impacted by this trend.
Samsung also impacted
One particular example showing that the high price of iPhones is pushing potential buyers to other phones is AT&T’s buy one, get one free campaign that was retired after just two weeks.
“We do not believe it is coincidence that the highest end of the product portfolio, the X, is the model that is flagging,” the analyst said.
In addition to the iPhone X, other models were impacted as well, and the most recent example is the Samsung Galaxy S9. Even though it doesn’t cost as much as the iPhone X, the new Galaxy S9 is still a high-end device that seems to be affected too by people looking into more affordable devices.
Apple, on the other hand, is believed to be working on a more affordable iPhone for the 2018 generation and which could launch with a 6.1-inch LCD display, Face ID, and metal body.