Apple has stopped disclosing unit sales for the iPhone, and if a report by IHS Markit is anything to go by, it's clear why. According to the report, iPhone shipments during Q3 were 35.3 million, down 14.6 percent year-over-year for the quarter.
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The reasons for this, according to IHS Markit's Jusy Hong and Gerrit Schneemann, are predictable – the newer handsets are too expensive and the older handsets aren't going down in price fast enough.
Apple continues to face challenges in terms of unit shipments—a trend that is unlikely to be fixed soon. Apple shipped 35.3 million iPhones in the second quarter, down 14.6 percent from 41.3 million units one year ago.
Apple continues to be more aggressive with its promotional activities, but still faces two key challenges: super-premium pricing for its latest models and insufficient price elasticity in its older models to drive significant additional shipments of two-to-three-year-old devices.
According to the report, Apple is now in fourth place in terms of global shipments, behind Samsung, Huawei, and Oppo. Closing on Apple's position are Xiaomi and Vivo.
Hong and Schneemann believe that the decline in unit sales will continue over the coming quarters. But the real questions are whether Apple will be able to keep revenues up, and whether a decline in sales will have a negative effect on the cash Apple pulls in by leveraging the ecosystem, such as App Store and content sales.
Q3 wasn't that bad for Apple, but much of that was down to China, both efforts by Apple, and the changing economic climate in the country.
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