This week, Apple’s vice president of product marketing Greg Joswiak confirmed to Reuters that the iPhone XR—which is $250 cheaper than the iPhone XS, starting at $749 with 64GB of storage—is currently the company’s most mainstream product as well as its most popular iPhone.
“Since the iPhone XR became available, it’s been the best-selling iPhone each and every day that it’s been on sale,” Joswiak added.
Interestingly, Joswiak’s revelations come less than a month after the tech giant said that it will stop disclosing sales data of its products, including iPhones, iPads, and Macs going forward.
“As I know you’re aware, by the way, our top competitors in smartphones, in tablets, in computers, do not provide quarterly unit sales information either,” explained at that time Apple CFO Luca Maestri during the company’s last earnings call.
Apple’s qualitative commentary on unit sales was intended to calm fears over weak iPhone sales
However, Maestri quickly added that when the Apple executive team believes “that providing qualitative commentary on unit sales offers additional relevant information to investors,” they will do so.
Which probably explains why Joswiak made his comments, primarily to calm investor fears over weak iPhone sales rumors after some Apple suppliers cut their revenue forecast (including AMS, Japan Display, Lumentum, and Qorvo) last month followed by a $100 price cut of the iPhone XR in Japan by the country’s largest mobile operator (NTT Docomo)—in order to boost sales–and last week’s threat by president Trump of tariffs on all of Apple’s hardware products made in China.
A confluence of events that caused Apple shares to drop more than 20%—falling in bear market territory—from their October peak at $232 a share.
Atherton Research’s Take
Here are the 3 key reasons why we believe that the iPhone XR became Apple’s best selling iPhone since its launch on October 26:
- Price: At $749, the 64GB iPhone XR is the most affordable model of Apple’s “iPhone X” lineup released this year—$250 cheaper than the equivalent iPhone XS, which starts at $999, and $350 cheaper than the slightly larger $1099 iPhone XS Max.
- Better value: The iPhone XR has most of the key features of its more expensive brethren (faster processor, Face ID, wireless charging, wide-angle and front-facing cameras). However, its aluminum design makes it a bit heavier and thicker than the stainless-steel versions with slightly larger bezels, less waterproofing, and no 3D Touch. On the plus side, the iPhone XR has an overall better battery life, more color choices (6 vs 3) and an LCD display that is much brighter than the OLED screen used in the more expensive models. So for the price, the iPhone XR is a much better value than the iPhone XS and XS Max which most consumers probably figured out as well, cannibalizing the sales of the higher priced iPhones.
- Timing: The cheaper new iPhone shipped more than a month after the higher-end devices. Just like most new products, there’s a sales peak at launch which then progressively drops over time. When the iPhone XR went on sale its peak sale easily surpassed the sales of all the other new iPhones—that saw their sales peak drop already. The sales momentum of the iPhone XR continues driven by its lower cost, advanced features, and overall better value.
Apple is again under great pressure — similar to what happened last year— to show that its strategy of selling iPhones, which represent nearly 60% of its revenue, at an ever higher price is still working.
At this point in time, our research indicates that Apple will easily hit the lower end of the range of its sales guidance for the current holiday quarter—$89 billion— making it the biggest in the company’s history.