Q3 2018: Really low Mac sales while PC sales remained constant


(Simon) #1

So in other threads we had already talked about 2018 Q3 Mac sales being very low, the lowest in almost a decade in fact.


In such discussions there is often this notion that people are buying fewer computers so it’s no surprise when Apple sells fewer Macs. Well at least for Q3 2018 we now know that’s baloney. While the total number of PCs shipped was unchanged (67.2M), Apple actually shipped 500k fewer Macs than during the same quarter in 2017. Of the global top six manufacturers, only one did worse than Apple. And while the top three all increased, one even by double-digits, Apple dropped 9%.

Back when Apple saw more Mac sales growth than the PC market, they liked to point to their innovation. Well, with Macs seeing hardly any innovation lately, this outcome I guess should really be no surprise to Apple.


#2

A big reason why PCs sales are growing is because of the Windows 10 replacement cycle. And PC sales had been declining for a few years. Also, shipments don’t necessarily equal increased sales, and not every PC that is shipped will be sold, and the vast majority will not be sold at list price, with most sold at steep discounts. Though the current Mac line up might be a little long in the tooth, it’s still being sold at list. Apple might not have sold as many Macs as they did in Q3 2017, but the Macs they did sell were most probably a lot more than profitable than the big majority of PCs.

Apple just posted its best Q3 ever, and their revenues have grown in the double digits for the past four quarters. And this quarter doesn’t even include the the new iPhones, Watch, and other products that were announced last month. Correct me if I’m wrong, but I don’t recall any momentous new product or service announcement in the third quarter. Even without any new Macs or other wiz bang products, the results way exceeded guidance and blew analysts’ expectations away. So IMHO, It was another outstanding quarter and a big reason why Apple became the first trillion dollar company.


(Tommy Weir) #3

I’m not surprised, most Windows 10 users I know are happy with it, word in the general public is positive. The kerfuffle around Windows versions seems to have dissipated and people are less wary of new PCs as a result.


(Josh Centers) #4

That’s not a shock. Mac prices are astronomical while PC quality has risen dramatically while keeping prices reasonable. And that’s assuming you even need a PC or Mac.


(Simon) #5

I think you’re right, Josh. In a period where PC products have improved a lot, Apple has chosen to let Mac wither. My concern is that Apple’s take from all of this will be “people don’t want Macs anymore”.


(Doug Miller) #6

Reading that article, it seems to show that Apple had a spike in revenues in Q3 2017 (maybe from people who were waiting on new MacBook Pros?) and that Q3 2018 seems in line with Q3 2016. If the data were smoothed (using, say, a four quarter moving average), it would probably look pretty flat rather than show a significant decrease in sales over time.

Also, the article mentions that details are often adjusted, sometimes rather significantly, after the fact.

Apple’s Q3 financial call is coming up in a few weeks and I’m sure that we’ll learn a lot more real information then.


#7

PC sales overall have been down for at least the last five years, Mac just had one not terribly bad quarter. The global trend is that people and businesses are not replacing PCs or Macs as frequently as they used to. Apple is just responding to market conditions. The big plus is that they are selling Macs at list prices. They are not duking it out with Dell, Lenovo, HP, Acer, etc., etc., etc. in a flooded market cursed with discounting and Windows vs. Chromebooks. If it wasn’t for Windows 10, the PC numbers wouldn’t look nearly as good.

I don’t think Apple is ignoring or abandoning Macs. They’re likely adjusting the product refresh cycle to account for the fact that people are spending to upgrade their mobile devices much more frequently and their wearables continue to sell like hot cakes.


(Tommy Weir) #8

Whoops… spoke too soon.


(Jack F) #9

Might the decline of sales have anything to do with the less versatile Mac laptops compared with Mac laptops of before. Apple got rid of the optical drive, which meanss you need an external drive to read DVDs/CDs or burn them. No more laptop but a multi-piece lug-top. Then the elimination of Firewire and fewer USB ports that are useful for a variety of reasons. So the new Macs are less versatile.


(Simon) #10

I guess we could argue forever about how versatile the new MBPs are or what really makes a Mac versatile. But I do believe you make a reasonable point. IMHO it’s rather obvious that in a period where PC manufacturers have made PC notebooks a whole lot better, Apple has chosen to just ignore the Mac to a significant degree. If you’re a stockholder, hearing Tim then chant “services, services, services” might get you over that, but as a Mac user that definitely isn’t cutting the mustard.


#11

If I remember correctly, Apple started phasing out optical drives about 8-9 years ago. If there was to be a big impact on laptop sales it would have begun to register then, but instead, sales continued to grow. At the time, flash drives and cloud storage had begun to erode sales of DVD and CD discs; they were already pretty much obsolete for sales of new software. Downloadable (which is now declining in sales) and streaming music, video and gaming were already overtaking the world.

Lighter, slimmer, faster, less bulky were always the key selling points for laptops. As when Apple stopped shipping Macs with floppy drives, and has been phasing out bulky, pokey, noisy, battery draining, heat blasting spinning drives and fans, PC manufacturers have been following in their footsteps. Removable CD/DVD drives aren’t that expensive, and most businesses, families, students in dorms and classrooms, and individuals can usually swap out or borrow a portable optical drive when really necessary.


#12

This news about Q3 results is just one reason why Apple has been investing more time and energy on Services and mobile devices than Macs:

App Store generated 93% more revenue than Google Play in Q3

https://techcrunch.com/2018/10/11/app-store-generated-93-more-revenue-than-google-play-in-q3/

The firm says that approximately 66% of the $18.2 billion in mobile app revenue generated in Q3 2018 came from Apple’s App Store. The store made $12 billion in the quarter, up 23.3% from the $9.7 billion it made during the same period last year.

Meanwhile, Google Play earned $6.2 billion in the quarter, up 21.5% from the year-ago quarter’s $5.1 billion.

This is particularly interesting since there are currently a few million more apps in the Google Play store than the App Store, and many, many millions more Android devices currently activated in the wild.

Amazon, who failed miserably in the mobile phone market, just announced they are ginning up avenues for promotional and advertising messages within Alexa skills:

https://www.fool.com/investing/2018/10/14/this-could-be-the-no-1-way-amazon-makes-money-with.aspx


(Dave Scocca) #13

Re: “The global trend is that people and businesses are not replacing PCs or Macs as frequently as they used to.”

Yes, I think this is true. It used to be that new computers would show a jaw-dropping speed improvement after 3-4 years, but computers last much longer these days.

My first Mac was a IIcx; with a couple of hard drive expansions it lasted me six years before it was too slow and old and I wanted to go to PowerPC.

My second Mac was a 7200. I got bigger hard drives more times than I can count, and after about four years I swapped my drives into a used 7300 and got a G3 upgrade for that, which held on for another four years.

My third Mac was a G4 tower. Again I got larger hard drives a few times, but after about six years it was getting creaky and I wanted to make the Intel transition.

My fourth Mac is a 27" iMac, purchased in 2010. I never pushed the limit of the 2TB internal drive I got with it, and last year swapped in a 1TB SSD which gave me an amazing speed boost. That machine is now eight years old and is faster than the day I bought it.

It will not update to Mojave, so I’m stuck in High Sierra. Is Mojave plus a retina display plus the Bluetooth Low Energy necessary for Continuity really enough of a leap forward for me to put my money into a new machine? I’ll probably keep looking at the prices of systems with a 2TB SSD and whether software starts to show up that requires Mojave or its successors, but at this point I’m not inclined to get a replacement unless forced by catastrophic failure or a significant leap forward in the hardware that I haven’t really thought of.

I’m not completely trouble-free–I’m getting some strange intermittent connectivity problems that I reboot to solve–but I’m certainly not feeling like an upgrade would be worth the cost.

Dave