Roger Fingas
Following up on the sudden news that December-quarter earnings will be lower than predicted by between $5 billion and $9 billion, Apple CEO Tim Cook promised future changes in a memo to employees.
"External forces may push us around a bit, but we are not going to use them as an excuse," Cook wrote in the memo, obtained by AppleInsider from a source not authorized to speak on behalf of the company. "Nor will we just wait around until they get better. This moment gives us an opportunity to learn and to take action, to focus on our strengths and on Apple's mission — delivering the best products on earth for our customers and providing them with an unmatched level of service. We manage Apple for the long term, and in challenging times we have always come out stronger."
The memo otherwise reiterated many of the claims in his bombshell letter from Wednesday, blaming weaker-than-expected iPhone sales on "macroeconomic" conditions, as well as problems "specifc to Apple and the smartphone industry."
In the letter Cook specifically highlighted China, noting that the entirety of Apple's revenue shortfall can be traced to the country. He also however blamed factors like a strong U.S. dollar, fewer carrier subsidies, and even people taking advantage of discounted battery replacements, which some saw as an admission that the company depends on degraded batteries to spur upgrades.
Confirmed in the memo are plans for an "all-hands" meeting on Thursday, set to take place at 9:30 a.m. Pacific time. Because of construction work at Apple Park, the meeting is being held in the Town Hall at 1 Infinite Loop.
"I'll have more details about the quarter, and I'm looking forward to your thoughts and questions," Cook concluded.
Some have seen the new guidance — revised from between $89 billion and $93 billion to just $84 billion — as evidence that Apple has finally pushed iPhone prices too high, starting the XR at $749 and the XS at $999. That's a hard sell in markets like China, where brands like Huawei and Oppo are now offering mid-range and high-end phones for hundreds less.
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Charles Martin
Malcolm Owen
William Gallagher
Christine McKee
Wesley Hilliard
Andrew Orr
88 Comments
iPhones have become too expensive, I simply quit upgrading.
Apple's other products don't offer any compelling upgrades to the older models I already have. I despise the new MacBook Pro and have zero interest in the trashcan 2013 Mac Pro.
While Apple offering higher end, with new features products than at the same time continue producing what has worked and accepted. For example, why drop non OLED strip Macbook Pro when introducing touchstrip Macbook Pro higher priced version ? I am sure Apple will make appropriate changes in ever changing world and will be same successful great company at the end.
They lost price discipline. Ahrendts gained too much influence and appears to have convinced Tim that they could go full out fashion house pricing strategy “we priced super high so people that want spend a lot can”.
hopefully that’s a lesson Tim learns. Let Angela run the stores, let the professionals run the business.
And Apple has pissed me off on an IPhone again. I just saw a commercial last night that XR is now starting at $499.
Ah nevermind, that price is with a trade in.