Apple to lower iPhone pricing in key markets after sluggish December quarter
Following the release of Apple's earnings report on Tuesday, CEO Tim Cook revealed the company is planning price changes for iPhones overseas to goose sales of the device after sluggish sales in China and other regions during the important holiday quarter.
In an interview with Reuters, Cook said that he believes the current trade tension between the United States and China has improved, suggesting an exacerbation of a contracting major economy might soon ease.
However, he also said that Apple is rethinking how it prices iPhones overseas after recent economic conditions in other markets. Apple in recent years has set the price of iPhone based on the U.S. dollar, a strategy that results in higher prices in certain regions.
"When you look at foreign currencies and then particularly those markets that weakened over the last year, those [iPhone price] increases were obviously more," Cook said. "And so as we've gotten into January and assessed the macroeconomic condition in some of those markets we've decided to go back to [pricing that is] more commensurate with what our local prices were a year ago in hopes of helping the sales in those areas."
Cook spoke to Reuters as Apple made its legally-required earnings disclosures. He addressed the fact that the iPhone's revenue was affected in particular by economic weakness in China.
Looking ahead, Cook sees a thawing of tensions between the U.S. and China, a situation that Apple said impacted iPhone sales over the trailing half of 2018.
"As we've gotten down in to January," he said. "January looks better than December looked. And I think if you were to graph up trade tension it's clearly less. I'm optimistic that the two countries will be able to work things out."