During its financial conference call for the third calendar and fourth fiscal quarter of 2013, Apple CEO Tim Cook shared a new perspective on the company's iPhone strategy after being asked questions about how Apple plans to address lower price segements of the smartphone market and where the iPhone 5c stands in the lineup, stating that the iPhone 4S is now the entry-level iPhone contrary to the belief that the iPhone 5c would be the entry-level device:
If you look at what we've done, we're selling the iPhone 4s as our entry offer. We sell the iPhone 5c as the mid-tier and the 5s. Our goal is to have growth across the iPhone but we want each of those categories to grow as compared to what we were doing previously. If you look at the total that we're making in the low end and mid tier and high end, the sum there, we'd like to grow in each one of those. We're really please that we did that.
Cook also elaborated the philosphy of seeing the iPhone 4S as the entry level iPhone after discussing foreign device pricing strategy and why the company did not keep the iPhone 4 in its lineup given its sales success:
What we did with our lineup this time was the 4s is replacing the 4. If you look at the US as an example, the 4s is now free. The 4 was previously. When you translate that out of the US, it depends on the market as to what specifically happens. Currency changes and the strength of the dollar doesn't always play in our favor in some goes.
We see the 4s as our entry iPhone offer that gives somebody the ability to access the entire ecosystem as a fantastic product. We understand that there is elasticity in that market and it will move accordingly.
Overall, Apple shared through its financial results that it has posted a revenue of $37.5 billion and net quarterly profit of $7.5 billion, or $8.26 per diluted share, compared to revenue of $36 billion and net quarterly profit of $8.2 billion, or $7.05 per diluted share in the year-ago quarter. The company also said that it has sold a record 150 million iPhones on the year, up 25 million from 2012, and the company has now sold 421.3 million smartphones in total.