iPad shipments, revenue plummets – Apple is helpless

After aggregating the shipment data of the past two months, there are reports that the Apple iPad still needs up to 9 weeks of delivery waiting time. Taking the Philippines as an example, users who ordered a space gray 256GB iPad Pro had to wait 63 days for the delivery. The report claims that Apple is helpless and the company has no choice but to prioritize the iPhone. Therefore, the iPad is making significant sacrifices for the iPhone to meet its target. This is because the iPhone and iPad use similar parts. The chip shortage situation means that they have to share what is available.

Apple iPad mini 6 Pro

This also seems to be confirmed in Apple’s earnings report and external statistics. The data for the first quarter of Apple’s 2022 fiscal year (October-December 2021) released not long ago showed that iPad revenue was $7.25 billion, a year-on-year decrease of 14%. In contrast, iPhone revenue was $71.63 billion, a year-on-year increase of 9.2%. Apple’s CFO said “very severe supply constraints” have led to shortages of iPads. Furthermore, he claims that the supply chain problems are mainly due to shortages of chips for older models.

According to IDC’s statistics, Apple’s shipments in the fourth quarter decreased by 8.6% year on year.

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Apple claims the Chinese smartphone market

The iPad sacrifices are not in vain as the iPhone is doing well globally. The latest data released by Counterpoint shows that in the fourth quarter of 2021, Apple became China’s largest smartphone supplier with a market share of 23%. This is the first time Apple has topped the Chinese mobile phone market since 2015. Zhang Mengmeng, a research analyst at Counterpoint, said Apple’s outperformance was driven by a mix of its pricing strategy and the premium it gained from Huawei. Since the release of the iPhone 13 series in September last year, Apple has risen to first place in the Chinese market. After that, it remained in the lead for most of the fourth quarter.

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Apple’s iPhone 13 series was launched in the Chinese market at a competitive price. For this reason, many high-end users turned to Apple mobile phones, pushing Apple to the top position again. Counterpoint believes that Apple’s high-end success is an encouraging sign and will continue to inspire Chinese manufacturers to deploy at the high-end. The average selling price of smartphones is expected to continue to rise in China. However, leading smartphone brands are now intensifying efforts to raise the average selling prices in response to declining sales.

In fact, smartphone sales in China fell 9% year-on-year in the fourth quarter. This is the third straight quarter of declining smartphone sales. According to Counterpoint, smartphone sales in 2021 will also continue to decline for the fourth consecutive year, down 2% year-on-year. Counterpoint pointed out that the past year has also been a milestone for Chinese manufacturers to adopt advanced technologies. They have entered the upstream chip field with the likes of Vivo, Oppo and Xiaomi having their won chips.

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