Last year the launch of the iPhone X was meant to herald the start of a ‘super-cyle’ of sales where everyone currently with an iPhone who had been waiting for something ’new’ would jump on the OLED screened iPhone X and slingshot the sales higher – a not improbably idea given the growth seen at the launch of the first ‘Plus’ phablet iPhone.
That didn’t happen, and the iPhone 8 and 8 Plus picked up a lot of the slack as Apple reduced the parts on order for the iPhone X production lie.
So this year is definitely the year of the super cycle. And if it’s not, then no worries, the iPhone 8 ‘slot’ in the new portfolio will be taken up with a new LCD-screened model. Well… the best-laid plans of Tim Cook and his team could be in danger.
As noted by Malcolm Owen, the latest look at the supply chain from Morgan Stanley’s Katy Huberty. And it’s not looking good for the lowest-ranged model in the 2018 iPhone portfolio. The replacement for the iPhone 8 (which remains nameless, but could easily be the iPhone 8S, the iPhone 9, or simply ‘iPhone) will be the only one of the three new models to feature an LCD screen.
And the LCD screen is behind schedule. Huberty writes:
We currently see no delay in the ramp of Apple’s upcoming flagship 5.8″ or 6.5″ OLED iPhones. However suspected issues with LED backlight leakage have caused a 1 month delay in mass production of the 6.1″ LCD iPhone, although this is down from a 6-week delay baked into the original production forecast, according to suppliers.
Although Apple is expected to launch the new iPhone family (the aforementioned update to the iPhone 8, an iPhone X update, and a new iPhone X Plus with a larger screen), the release dates of the individual handsets are not as clear. 2017 saw the iPhone 8 and iPhone 8 Plus go on sale by the end of September, with the iPhone X going on sale into November and remaining stock limited until 2018.
There is now a good chance that the Apple will have the more advanced (and more expensive) handsets of the iPhone X (2018) and the iPhone X Plus in retail stores before the cheaper iPhone 8 replacement arrives. That’s going to be a curious sales dynamic.
Last year the focus was on the X, but the 8 arrived in store first. Apple has been taking every moment to mention that the iPhone X is the best-selling handset each week during Q1 2018 it has been on sale, but what if the iPhone 8 and 8 Plus sales are combined? And what happened after Q1? According to Counterpoint Research, that’s when sales of the iPhone 8 started to outstrip every other iPhone.
So, the delay to the complicated LCD screen that will mimic the look of the OLED screen on your more expensive model is going to delay the launch of the handset that will replace the handset that is the current front-runner.
The technologically advanced handset, that will be replacing the technologically advanced handset that didn’t kick off a super-cycle, will be the lead handset at launch, and likely be the only handset immediate available.
I’m curious to see how this plays out. With apple-tinted spectacles, it could mean everyone decides to go straight to the new X and X Plus handsets, boosting up Apple’s average revenue per handset and offering Tim Cook and his team the potential of a super-cycle. At the other extreme, the appeal of the X and the X Plus remains steady to the current sales, and those looking for the ‘improved iPhone 8 will either have to wait until stock becomes available, or decide to make the move to Android.