Apple Earnings 2016: Company Sees First Decline In Profits Since 2001 — Are iPhone 7 Explosions To Blame?
Apple’s earnings in 2016 may still be profitable for the company that Steve Jobs built, but they are dropping for the first time in over a decade. It may be due to the high price of Apple products opposed to the generally higher quality that keeps consumers coming back year after year. That high price may be part of what appears to be a break in the 15-year trend.
When your company is known for its quality, anything can destroy your image if it’s a big enough issue. A fast-food chain known for its delicious burgers could lose business to another chain if their customer service is lacking or they cheat customers out of money because they accidentally swapped a chicken sandwich with a cheeseburger.
Recent news of the iPhone 7 exploding, according to iTech Post, may have created waves of disappointment, as consumers could be abandoning their product loyalty and going with Android instead. Samsung appears to be the culprit for the similar trend with the Android Galaxy Note 7, but Apple is known for depending on them to supply parts for their smartphones.
Apple’s 15-year streak is officially over. The company just posted its first annual sales decline since 2001 https://t.co/T2aCAHTrXQ pic.twitter.com/DMiLApk5NZ
— CNN (@CNN) October 26, 2016
Another possibility is the lack of a headphone jack. This makes all 3.5mm-based headphones and earbuds useless and forces the use of Bluetooth, which is notorious for making phone calls difficult due to bad connections or excess background noise. It’s usually obvious when the other person is talking on Bluetooth, because if they don’t speak up, you often can’t understand them.
2001 was the first time Apple saw an earnings boost due to the introduction of the iPod, a handy device that ended up revolutionizing the way we play music. The smallest of these, the Shuffle, was the only one without a screen, but it delivered the same music quality as those shoulder-riding stereos we had in the 80s. The drop in size came at a price, though, and the iPod Shuffle is still around $40 and up for something you could literally clip to your shirt.
Apple’s earnings in 2016 declined to $1.67 per share, according to CNBC, down from $1.96 per share in 2015. This marks the first time in 15 years that Apple’s profits have dropped.
Some might say that part of the reason would be the untimely death of founder Steve Jobs, who was known to be a visionary genius. The company has since been run by Tim Cook, who took a different approach.
Apple?’s annual sales fall for the first time since 2001 https://t.co/eOfK4bv1An pic.twitter.com/kzAkUkCKh0
— CNN Breaking News (@cnnbrk) October 25, 2016
One approach may include abandoning Samsung as a supplier if the manufacturer can’t halt the explosions being reported with a re-design. The iPhone 7 and Galaxy Note 7 appear to be following a disturbing trend most notably seen with hoverboards last year.
The rolling conveyance toys had been known for using high-heat batteries and a lack of ventilation, which often caused them to catch fire. This happened while riding or even just charging. Amazon and other online retailers had offered a full refund to anyone who purchased the toys.
Under Tim Cook, Apple is said to be more environmentally conscious, pushing their products to be greener, according to CNN. However, the emergence of the possibility of the iPhone 7 exploding could lead to increased pollution, ever so slightly, if not fixed.
Senior vice president at Synchronoss Technologies Dan Ives has stated, “It’s going to be interesting: The next 6 to 12 months are pivotal for the industry. It speaks what type of pent up demand there is. Does Google become a player? Will Samsung get back on track? I think it’s almost like a game of high stakes poker. You want to see where everyone’s cards stand.”
Can Apple’s earnings in 2016 recover after news of iPhone 7 explosions?
[Featured Image by Jstone/Shutterstock.com]
