According to Ming-Chi Kuo, often referred to as the “best Apple analyst on the planet”, iPhone XR shipping estimates are expected to be 30 million units lower than originally expected due to sales of the iPhone XS and iPhone XS Max, and continuing sales of “legacy” models such as the iPhone 8 and iPhone 7.
The note from Kuo sees the analyst drop is overall iPhone shipment forecasts by 15–20 percent for the first quarter of 2019. During the first quarter of next year, January to March, Kuo believes iPhone sales will decline year-over-year, with predictions of 47-52 million iPhone sales in the period compared to 52 million sold in the first quarter of 2018.
Ming-Chi Kuo believes iPhone XR is too expensive, with customers holding off from purchasing the handset until Apple will most likely drop the price next year alongside the introduction of its new 2019 iPhone line. Another reason Kuo believes iPhone XR sales are faulting is due to competition from Huawei Mate 20 in emerging markets and from customers who prefer devices with a dual-camera system.
We have reduced our iPhone XR shipment estimation from 100mn units to 70mn during the new product lifecycle (4Q18–3Q19) for the following reasons: 1) Negative impacts on consumer confidence from the trade war, especially in the Chinese market, 2) expectations from more users for more affordable XR or the dual-camera and narrower bezel design to be provided at the current price level, and 3) competition from Huawei’s Mate 20 series. We have reduced our XR shipment estimations for 4Q18, 1Q19, and 2Q19 by 30–35%, 25–30%, and 25–30% to 30–35, 20–25, and 10–15mn units, respectively.
Kuo believes that iPhone shipments for Apple’s current quarter will be in the same 75–80 million range he previously predicted, while he has lowered his first-quarter estimate to 47–52 million from a previous range of 55–60 million.