- In December, Apple lowered the value of an iPhone battery alternative from $79 to $29.
- The transfer got here after a scandal erupted over Apple’s observe of slowing down iPhones with older, weaker batteries – within the identify of guaranteeing extra dependable efficiency.
- Barclays analysts imagine that the battery alternative program might have an effect on iPhone gross sales and the typical worth of iPhones.
- They say that the “supercycle” of gross sales and upgrades is “even much less doubtless.”
Apple is presently in the course of a self-inflicted scandal after the corporate admitted that an iPhone software program replace was slowing down sure gadgets with older, weaker batteries.
The revelation opened Apple as much as shopper complaints of deliberate and accelerated obsolescence. In response, the corporate discounted alternative batteries, which repair the issue, from $79 to $29. Still, the entire episode has tarnished Apple’s fame, even because the matter escalates to attract congressional attention.
Now Barclays analysts imagine that the scandal might damage Apple’s backside line, too: In a be aware to purchasers on Thursday, the financial institution estimated that Apple’s battery alternative might persuade loads of clients to exchange their battery as a substitute of shopping for a brand new iPhone.
That can be a bearish signal for Apple. “If sustained, then we predict the prospect of that sought-after tremendous cycle displaying up is even much less doubtless,” analyst Mark Moskowitz and group wrote. The program is already fashionable, writes Barclays; if that pattern continues, Apple might promote each fewer iPhones and see individuals shopping for cheaper fashions.
“In our view, in the course of the December quarter, with the absence of the $29 battery alternative provide till late within the final week of quarter, many iPhone 6 and 6s customers may need thrown-in-the-towel and upgraded to iPhone X or iPhone eight as a result of their iPhones have been slowed down by iOS system updates and growing old batteries.”
In the December quarter of 2016, Apple bought 78 million iPhones, however in 2017, it solely bought 77.three million items. The year-ago quarter was one week longer, which accounts for the decline. The shortfall in iPhone gross sales have been made up by a considerably larger common worth per telephone— $796, over $100 larger than the typical in the identical stretch of 2016.
Barclays previously modeled a scenario the place Apple might lose $10.29 billion in iPhone gross sales if 16 million individuals resolve to not improve because of the battery deal.
Shorter wait instances
Barclays’ evaluation is predicated on a examine of 30 Apple retail shops, and the wait instances they’re presently quoting for battery replacements. They discovered that the typical wait instances for a battery alternative have been 2 weeks on common, with a most wait of four.5 weeks. That’s down from mid-January, when Barclays discovered it was four weeks and 6 weeks, respectively.
Separately, a memo distributed to Apple stores and authorized retailers last month mentioned that batteries for one mannequin of affected iPhone, Phone 6 Plus, will not be delivered till March or April.
Apple retail workers previously told Business Insider that many individuals changing thier batteries do not want a brand new one.
“I’d say lower than 10% of the telephones we now have ordered batteries for really need a battery, based mostly on diagnostics,” one Genius advised Business Insider in January, requesting anonyminity as a result of they weren’t licensed to speak to the press.
“I really feel dangerous for the individuals that really want batteries and have to attend as a result of individuals assume that Apple is having a ‘sale’ on batteries,” the staffer continued.
Barclays reiterated its ranking of Apple inventory as “impartial,” and offers it a worth goal of $170.