Apple blames lackluster sales on iPhone rumors
updated 07:12 pm EDT, Tue July 24, 2012
Customers waiting for next device
Apple executives have admitted that persistent rumors surrounding its upcoming devices, such as the sixth-generation iPhone, have had a negative impact on sales. After several years of stellar performance and beating Wall Street forecasts, the company failed to meet analyst expectations for its latest fiscal quarter. When pressed by analysts, chief financial officer Peter Oppenheimer cited the strong US dollar, economic conditions and ongoing rumors as its biggest challenges.
"We're reading the same rumors and speculation that you are about a new iPhone," Oppenheimer noted during a financial conference call.
The company achieved 100 percent year-over-year iPhone sales growth in select markets such as China, however sales failed to maintain momentum in Europe and other markets. Chief executive Tim Cook noted particularly slow Mac sales ahead of the company's WWDC conference, where the company was widely expected to unveil the Retina MacBook Pro, though the new device was met with stronger-than-expected demand in the last few weeks of the quarter.
The executives declined to provide any specific numbers regarding the estimated impact from product speculation and rumors, while maintaining that the company is happy with its quarterly performance. The company beat its own guidance for the quarter, despite falling short of analyst expectations.
"I'm glad that people want the next thing; I'm super happy about it," Cook added. "I'm not going to put any energy into getting people to stop speculating."
AT&T made a similar admission as part of its quarterly financials, which received a boost from customers waiting for the next iPhone rather than upgrading early. Apple's iconic handset is believed to fetch significant subsidies compared to many other smartphones, resulting in higher margins when subscribers delay purchases past upgrade eligibility dates.
The sixth-generation iPhone has been the focus of a myriad of rumors, some of which point to a new dock connector, LTE support and a metal housing. October is viewed as a likely launch time-frame, leaving a year between the iPhone 4S release in October of last year.
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Apple's biggest sales weakness is its incredibly predictable product cycles: new iPhones in late summer/early fall, new iPods in the fall, iPads in spring, laptops around wwdc.