Uh oh. Quarter after quarter Apple has seemed to crush estimates and sell more iPhones than the year before. The company has made great business moves in an effort to make sure that continues to happen, like its expansion into China, but the honeymoon may soon come to an end.
Morgan Stanley’s Katy Huberty recently published a research note in which she predicts sales of the iPhone to drop for the very first time in 2016. Huberty isn’t expecting a terribly steep decline like we’ve seen with Apple’s iPad sales recently, but a 5.7 percent drop in sales during Apple’s fiscal 2016 for a total of 218 million units, according to Business Insider, which saw the report. The figure is expected to reflect a 2.9 percent decrease in sales during the 2016 calendar year.
There are a few ways to look at this. First, yes, it’s kind of scary for a company like Apple, which makes a lot of money from its incredible iPhone sales. However, at some point the company is going to hit a ceiling and this might be it… at least according to Huberty, who attributes the decline to “higher prices in international markets (ex-China) and maturing smartphone penetration in developed markets weighs on upgrades and new user growth.”