Apple's $29 Battery Replacement Program Could Lead to 16M Fewer iPhones Sold in 2018
0Apple's $29 Battery Replacement Program Could Lead to 16M Fewer iPhones Sold in 2018.
Apple's decision to offer $29 battery replacements to customers with older iPhones could cause iPhone sales to drop in 2018, according to Barclays analyst Mark Moskowitz (via CNBC).
Customers opting for a battery replacement instead of upgrading an iPhone could be a "mild headwind" for iPhone unit sales, potentially resulting in millions of fewer iPhone purchases during the year. Moskowitz believes up to 77 percent of iPhone users are eligible to upgrade their batteries.
In our base case scenario, 10% of those 519M users take the $29 offer, and around 30% of them decide not to buy a new iPhone this year. This means around 16M iPhone sales could be at risk, creating ~4% downside to our current revenue estimate for C2018.It remains to be seen if and how the battery replacement program will impact sales in practice despite analyst predictions, as there are other considerations that drive upgrades, such as new features.
Apple began offering reduced-cost battery replacements following backlash from an admission that it slows down some older iPhone models with degraded batteries to prevent them from shutting down unexpectedly.