Apple’s profit expected to drop for the first time in a decade
We thought this day will never come, but according to a recent report from Bloomberg, the care free days of Apple are about to be over.
Fourteen analysts are predicting that Apple’s sales are about to experience a reduction for the first time in ten years. Apparently, competition from Samsung is getting tougher to handle for the Cupertino giant. Also, some new products the company introduced haven’t produced that much cash flow.
Oracle Investment Research analyst Laurence Balter stated:
“The market is in show-me mode for Apple. The market needs to see some evidence that the future looks bright because that candle is flickering.”
On the other hand, the iPhone sales seem to have been hit by a draught, as a Bernstein analyst predicts Apple has shipped only 25 million units in the current quarter. That’s quite a fall from the 35.4 million iPhone it sold last quarter.
Certain information leaked by supplier insider sources have also shown that the appeal of Apple products has been diluted. For example, Hon Hai Precision – the company in charge of producing iPhones and iPads in China, has experienced a drastic drop in revenue, which was reported this month. Analysts expect that this trend will continue to deepen even more. Unless Apple does something. Alex Gauna of JMP Securities feels that “things have changed for Apple. The competition is more intense”.
And he is right. Just this week, Samsung is putting its brand new shiny Galaxy S4 smartphone on the shelves of retail stores everywhere. At this point, pressure is starting to build for Apple to launch new ground breaking products to counter the competition. We’re very curious what we’re going to see come out of Cupertino.