The iPhone X is far from a flop. If anything, demand for Apple’s next-gen device appears to be strong, with Tim Cook noting during Apple’s recent earnings conference call that the device has been the best-selling iPhone model since its release this past November. Still, there have been quite a few reports suggesting that iPhone X sales, while strong, haven’t exactly lived up to expectations that were perhaps a tad too optimistic.
While iPhone X owners love the device, there’s no getting around the fact that the iPhone X is wildly expensive. With a starting price of $999, Apple’s flagship iPhone requires prospective buyers to make huge investment should they want to enjoy Apple’s most advanced smartphone features. In fact, a recent survey found that 31% of iPhone owners who didn’t upgrade to the iPhone X cited the device’s expensive price point as the primary reason.
Looking ahead to Apple’s 2018 iPhone lineup, it appears that Tim Cook and co. will adjust accordingly. As you’ve likely heard by now, Apple’s 2018 iPhone lineup will reportedly consist of three new devices: a 6.5-inch iPhone X Plus, a second-gen iPhone X, and a 6.1-inch iPhone with an edgeless LCD display.
With that said, UBS analyst Steven Milunovich believes that Apple’s upcoming iPhone lineup will be considerably more affordable and that Apple will make up the revenue difference on increased volume.
In remarks picked up by The Street, Milunovich opines:
One scenario is a 6.4-inch OLED model priced at $1,099, 5.8-inch OLED at $999, and a 6.1-inch LCD at $750. This would drive a flat-to-up ASP if over 70% of buyers opt for the flagship models and OLED screens take 35% of the mix. If Apple gets more aggressive on price, we could see a $1,050 6.4-inch OLED model, a $900 5.8-inch OLED, and a $700 6.1-inch LCD. Apple would need at least 80% of buyers to opt for the flagship models with the OLED models accounting for 40% of the mix to achieve a flat-to-up ASP. The fall line-up offers another chance to move users up in price with a larger OLED model and a lower entry point for Face ID.
In other words, those who want the best Apple has to offer — which is to say an edgeless OLED display — will still be paying a premium. The 6.1-inch LCD model, however, will offer users an attractive value proposition insofar that they can save a few hundred bucks by opting for an LCD display as opposed to OLED.
Interestingly enough, some analysts anticipate that Apple’s 2018 iPhone lineup might feature even a more aggressive pricing matrix than what Milunovich lays out. RBC Capital Markets analyst Amit Daryanani, for example, believes Apple might price the second-gen iPhone X at $899 and the 6.5-inch iPhone X Plus at $999. The 6.1-inch iPhone, Daryanani writes, might be priced anywhere between $699 and $750.
While we’ll have to wait a few months before any of these details become official, it stands to reason that Apple’s 2018 iPhone lineup might usher in the monster refresh cycle that many analysts and tech observers thought would happen with the company’s 2017 lineup. Put simply, Apple in 2018 may very well smash a number of iPhone sales records.
