Wall Street Not Impressed with iPhone 7, Apple shares fall 3%

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Achtung!

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Mar 10, 2015
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#1
Wall Street and investors were not impressed with the iPhone 7 and Apple's shares have fallen 3% since its release. The stock is now down 15% year-on-year.

http://www.businessinsider.com/apple-stock-drops-after-iphone-7-2016-9?r=US&IR=T
Wall Street didn't like Apple's big iPhone 7 event

Traders don't think the iPhone 7 will return Apple to growth.

Apple stock was down about 2.84% at market close on Thursday, the day after the company revealed its new iPhone models.

Apple shares closed at $105.52 as compared to $108.36 at close on Wednesday. At one point during the day, the stock dropped to $105.41.

Apple stock is down about 15% from its 52-week high at $123.82.

Apple announced several new products on Wednesday, including the iPhone 7, the iPhone 7 Plus, new Apple Watch models, and a set of wireless earbuds.

After two straight quarters of annual sales declines, Apple is hoping the new iPhone models can return Apple to year-over-year growth.
My perspective:

  • Shares will fall another 10~15% until September 2017 when Apple probably will release a VR product.
  • Most analysts predict pre-orders of the iPhone 7 will flat-line or fall below expectations
  • Apple had the perfect opportunity to pounce on Samsung after they recalled the Galaxy Note 7s due to the Lithium battery issues. However the media is all reporting how disappointed they are with the iPhone 7, which almost completely erases Apple's advantage in this short time-framed opportunity.
  • Apple's iPhone SE is popular in the BRICs, African and Southeast Asian nations, however they sell for much lower profit margins compared to the iPhone 6/7. And they also contribute to lower revenue
  • Apple's "Airpods" are gimmicky and ultimately leads to poorer sound quality. Who thought they could fool customers?

Discuss.
 

Yakk

Golden Member
May 28, 2016
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#2
I see it more as Apple's marketing faltering more then anything tech related. People buy what they are excited about, and it's the marketing people's job to get people excited. Since the firing/replacing of their longtime marketing team... slowly, but surely that magical pixie dust has been wearing off.

We will probably see a revenue bump this quarter with the new iPhone, but I'll say it'll be short lived and I'd expect overall another year-on-year decline of about 8%, at which point alarm bells will start going off at the executive level I'd wager
 
Mar 11, 2000
22,585
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#3
My prediction: iPhone 7 sales will initially be slow because of supply constraints, but eventually will be decent, although partially because Samsung fscked up and shipped phones that explode. AAPL will plateau, and there will be no VR product. And as much as I am not a Beats fan, I think Apple's removal of the headphone jack will stimulate Lightning Beats and wireless Beats sales.
 
Feb 28, 2003
17,953
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#4
My prediction: iPhone 7 sales will initially be slow because of supply constraints, but eventually will be decent, although partially because Samsung fscked up and shipped phones that explode. AAPL will plateau, and there will be no VR product. And as much as I am not a Beats fan, I think Apple's removal of the headphone jack will stimulate Lightning Beats and wireless Beats sales.
It has to do that or the whole premise behind removing the headphone jack will be a failure.
 

Zaap

Diamond Member
Jun 12, 2008
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#5
Awesome. Time to buy some more AAPL.
 

Achtung!

Senior member
Mar 10, 2015
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#6
My prediction: iPhone 7 sales will initially be slow because of supply constraints, but eventually will be decent, although partially because Samsung fscked up and shipped phones that explode. AAPL will plateau, and there will be no VR product. And as much as I am not a Beats fan, I think Apple's removal of the headphone jack will stimulate Lightning Beats and wireless Beats sales.
Well the Samsung lithium battery issue will be solved in a week or so. And the recovery of Samsung's stock price suggests that the majority of investors think that this will be better for Samsung in the long-run, compared to if they ignored it.

I'm not sure how successful the iPhone 7 will be.

Also why are you predicting no VR product? I think Apple needs to make a significant move, otherwise it's sales and profits are going to continue to decline, and their stock price will probably fall below $100 again, reaching the support level of $90~$95.
 

bradly1101

Diamond Member
May 5, 2013
4,684
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#7
But with those stylin' ear buds everyone will know that that's an iPhone making your pants bulge.
 

Commodus

Diamond Member
Oct 9, 2004
6,260
417
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#8
Also why are you predicting no VR product? I think Apple needs to make a significant move, otherwise it's sales and profits are going to continue to decline, and their stock price will probably fall below $100 again, reaching the support level of $90~$95.
Analysts and investors also thought Apple 'needed' to make netbooks and TV sets, and time has shown that either was a foolish bet (Chromebooks are spiritually linked to netbooks, but they also overcome a lot of the performance and size issues that held them back). Remember what happened when Samsung rushed into the modern smartwatch market because it felt it 'had' to get ahead of Apple? The Galaxy Gear... yeah. It was ahead of its time, but clearly not well thought-out enough to be a success.

Apple's MO isn't to enter a market simply because everyone else is there. It determines whether or not there's a big potential market, and will wait years to enter that market if it doesn't think the technology is truly ready. I'm not convinced that VR will be mainstream enough by 2017 that Apple will 'have' to be in that space -- it's still prohibitively expensive for most people, and there are clear limitations like low display resolutions, poor performance outside of high-end hardware, and having to either tether to a PC or rely on your phone.

My hunch: if Apple does VR at all, it'll wait until it can offer a fully integrated headset: no external PC, no phone, no 'backpacks' or other separate devices. It won't be cheap (this is Apple), but it'll be cheaper than dropping, say, $599 plus the cost of a high-end PC. And that may mean waiting until 2018 or later to get into the game.
 
Mar 11, 2000
22,585
0
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#9
I predict no VR because it's pointless, at least in the near term. It's a solution looking for a purpose. It has not found one yet in the mainstream consumer market.
 

Kazukian

Platinum Member
Aug 8, 2016
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#10
Apple always drops a little after an announcement, no way they'll drop another 10%

No VR for at least 1 or 2 years.

Sales will be in line with past years, or a bit below, there are a ton of people due for an upgrade, and there are a lot of creative upgrade programs.

The phone market has matured, and Apple still isn't doomed.

One thing I've noticed is Hollywood loves the 5/5s/SE platform, I always notice how phones allow you to date a movie, the 5 platform gives movies a chance to be more timeless. I think we'll see the "5" platform for many years.
 

rumpleforeskin

Senior member
Nov 3, 2008
377
1
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#11
One of apples greatest strengths is their ability to market their products in a way that makes the consumers think they are getting the very best device in the world. iPhones may not actually be the best handsets in the world but they are always around the top few available at the time and along with the marketing hype people are willing to pay a premium because they feel they are getting the most cutting edge product available.

The way I see it Apple has 3 issues with the new iPhone:

1. There is little visual change to the device and people want to feel they are buying an upgrade externally as well as internally.

2. Press coverage of the headphone jack rightly or wrongly has been negative

3. Many he "new" features added to the iPhone 7 are not unique to Apple which detracts from the "Only Apple offers this" marketing e.g.
----Water/Dust resistance - Samsung S5 (2014)
----Dual lens camera and Bokeh effect - HTC M8 (2014)
----720p screen - ??? (circa 2011) (I quite like the screens apple uses as they are very responsive and have great contrast but the low resolution is glaringly obvious between my S7 and iPhone 6)
----Capacitive button with haptic feedback - Kindle voyage (2014) (I never suffered home button failure on any iPhone so see this as a solution in search of a problem)
----A10 Fusion core - This should be awesome, though how many non techies will care about it I don't know, the iPhone 6 certainly feels fast enough.

So all in the iPhone 7 is going to be a great device, but I don't think there is enough to differentiate it from other high end devices to get the hype that previous iPhones had.
Without the hype it will be harder to charge the premium prices which will knock sales.
But if you are already an Apple user you don't have a great deal of handsets to choose from when upgrading if you still want to keep the Apple ecosystem. So it will still sell very well
 

Kazukian

Platinum Member
Aug 8, 2016
2,034
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91
#12
One of apples greatest strengths is their ability to market their products in a way that makes the consumers think they are getting the very best device in the world. iPhones may not actually be the best handsets in the world but they are always around the top few available at the time and along with the marketing hype people are willing to pay a premium because they feel they are getting the most cutting edge product available.

The way I see it Apple has 3 issues with the new iPhone:

1. There is little visual change to the device and people want to feel they are buying an upgrade externally as well as internally.

2. Press coverage of the headphone jack rightly or wrongly has been negative

3. Many he "new" features added to the iPhone 7 are not unique to Apple which detracts from the "Only Apple offers this" marketing e.g.
----Water/Dust resistance - Samsung S5 (2014)
----Dual lens camera and Bokeh effect - HTC M8 (2014)
----720p screen - ??? (circa 2011) (I quite like the screens apple uses as they are very responsive and have great contrast but the low resolution is glaringly obvious between my S7 and iPhone 6)
----Capacitive button with haptic feedback - Kindle voyage (2014) (I never suffered home button failure on any iPhone so see this as a solution in search of a problem)
----A10 Fusion core - This should be awesome, though how many non techies will care about it I don't know, the iPhone 6 certainly feels fast enough.

So all in the iPhone 7 is going to be a great device, but I don't think there is enough to differentiate it from other high end devices to get the hype that previous iPhones had.
Without the hype it will be harder to charge the premium prices which will knock sales.
But if you are already an Apple user you don't have a great deal of handsets to choose from when upgrading if you still want to keep the Apple ecosystem. So it will still sell very well
I think you're about right, although I have had a couple home buttons fail over the years, not on my phones, but on the kid's devices. Am curious how the haptic feedback works on the phone, really like the touchpad on my MacBook.
 

Mike64

Platinum Member
Apr 22, 2011
2,111
15
91
#13
1. There is little visual change to the device and people want to feel they are buying an upgrade externally as well as internally.
After all, dropping a month's rent on a new phone wouldn't be nearly as satisfying if your friends (and the occasional stranger on the street) didn't immediately say "oh, wow, is that the new iPhone?" the second you pull it out of your pocket...:p
 
Last edited:
Dec 7, 2004
12,632
163
126
#14
Wall Street and investors were not impressed with the iPhone 7 and Apple's shares have fallen 3% since its release. The stock is now down 15% year-on-year.

http://www.businessinsider.com/apple-stock-drops-after-iphone-7-2016-9?r=US&IR=T


My perspective:

  • Shares will fall another 10~15% until September 2017 when Apple probably will release a VR product.
  • Most analysts predict pre-orders of the iPhone 7 will flat-line or fall below expectations
  • Apple had the perfect opportunity to pounce on Samsung after they recalled the Galaxy Note 7s due to the Lithium battery issues. However the media is all reporting how disappointed they are with the iPhone 7, which almost completely erases Apple's advantage in this short time-framed opportunity.
  • Apple's iPhone SE is popular in the BRICs, African and Southeast Asian nations, however they sell for much lower profit margins compared to the iPhone 6/7. And they also contribute to lower revenue
  • Apple's "Airpods" are gimmicky and ultimately leads to poorer sound quality. Who thought they could fool customers?

Discuss.
Wall Street needs moar courage.
 
Nov 20, 2005
14,612
2
126
#15
Their sales seem to be brisk still. The shiny black one is sold out until November.
 

aigomorla

Cases and Cooling Mod PC Gaming Mod Elite Member
Super Moderator
Sep 28, 2005
17,164
48
126
#16
After all, dropping a month's rent on a new phone wouldn't be nearly as satisfying if your friends (and the occasional stranger on the street) didn't immediately say "oh, wow, is that the new iPhone?" the second you pull it out of your pocket...:p
LOL...

i get that a lot with my note 7.
except its more like...

oh is that the new note 7? wow its pretty... but can u stay away from me, i hear those things blow up.

:rolleyes:
 

stlc8tr

Golden Member
Jan 5, 2011
1,106
0
76
#17
Closing prices for September 7, 2016:

AAPL: 108.36 (USD)
KRX:005930: 1,621,000 (KRW)

Let's check back in a year. :)
 

Zaap

Diamond Member
Jun 12, 2008
7,109
35
126
#18
LOL...

i get that a lot with my note 7.
except its more like...

oh is that the new note 7? wow its pretty... but can u stay away from me, i hear those things blow up.

:rolleyes:
What service you using it with? a TnT, Sprint for Cover, or VerizBoom?
 

Achtung!

Senior member
Mar 10, 2015
282
0
36
#19
Apple always drops a little after an announcement, no way they'll drop another 10%
Uhh, no it doesn't.

Apple stock gained in 6/11 iPhone announcements.
Apple stock lost in 5/11 iPhone announcements.

And the iPhone 7 is the 2nd worst performing iPhone announcement.

BTW, Apple's stock price has now dropped by 6% since the iPhone 7 announcement. I think a greater than 10% drop is definitely a possibility now as the next support level is at $90~$95. Therefore, a drop by 15%~20% is definitely probable for Apple stock.

Doesn't bode well for Apple next year.

http://fortune.com/2016/09/09/apple-stock-iphone-launches/


Their sales seem to be brisk still. The shiny black one is sold out until November.
Yeah "sold out" because Apple ordered less iPhones to be manufactured by FoxConn.
 
Last edited:

Kazukian

Platinum Member
Aug 8, 2016
2,034
0
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#20
Achtung! You failed to provide a time frame earlier, if you define the parameters after a prediction or pronouncement, that's not fair.

But feel free to carry on.
 

sweenish

Diamond Member
May 21, 2013
3,656
5
91
#21
Apple always drops a little after an announcement, no way they'll drop another 10%

No VR for at least 1 or 2 years.

Sales will be in line with past years, or a bit below, there are a ton of people due for an upgrade, and there are a lot of creative upgrade programs.

The phone market has matured, and Apple still isn't doomed.

One thing I've noticed is Hollywood loves the 5/5s/SE platform, I always notice how phones allow you to date a movie, the 5 platform gives movies a chance to be more timeless. I think we'll see the "5" platform for many years.
This is the post that ended the thread. I don't know why someone feels like this is groundbreaking news every single year.
 

gorcorps

aka Brandon
Jul 18, 2004
30,622
8
126
#22
Achtung! You failed to provide a time frame earlier, if you define the parameters after a prediction or pronouncement, that's not fair.

But feel free to carry on.
Don't encourage him. How he isn't on everyone's ignore list by now is beyond me.
 

Commodus

Diamond Member
Oct 9, 2004
6,260
417
136
#23
What I'm looking forward to: the logical gymnastics Achtung will go through half a year from now to justify the absence of a headphone jack on the Galaxy S8.

(No, it's not a certainty that the S8 will go that route, but you can be sure Ach will find a way to spin it as a positive because Samsung did it)
 
Mar 11, 2000
22,585
0
106
#24
I'm pretty sure Samsung will keep the headphone jack for at least a few years, if not longer.
 

Achtung!

Senior member
Mar 10, 2015
282
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#25
What I'm looking forward to: the logical gymnastics Achtung will go through half a year from now to justify the absence of a headphone jack on the Galaxy S8.

(No, it's not a certainty that the S8 will go that route, but you can be sure Ach will find a way to spin it as a positive because Samsung did it)
Seeing how Apple's shares have fallen because of their decision to get rid of the headphone jack in place of the gimmicky "Airpods", no I don't think Samsung will adopt their strategy.

I wouldn't be surprised if Apple adopts OLED display technology, however. They already signed a contract with Samsung to buy 100 million OLED panels starting from 2017.

Apple orders 100 million Samsung OLED panels for the 2017 iPhone
http://www.gsmarena.com/apple_repor...led_panels_for_the_2017_iphone-news-17792.php
 
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