If we take a look at the iPhone market in Japan and China, it is obvious that there have been some price cuts. However, it appears that Apple is not done yet, and experts believe that even more cuts are on their way.
Previous predictions published in November let us know that the price for the Japan iPhone XR will be cut, and this is something that happened right away, as a $100 discount was introduced. Another report suggests that the Chinese models will also receive discounts, and this has also been confirmed.
This time Webbush believes that even more price cuts will follow in China. The reason for this is because the Chinese market is very important for Apple. However, the company does have some serious rivals there, so price cuts are used to attract customers.
[China is critical for Apple going forward and that’s] why we expect more significant price cuts on XR over the coming months. While some investors will fret around price cuts and what it means for top-line growth in the next few quarters and losing perception as a luxury smartphone, taking a step back it’s all about the installed base for Apple.
In our opinion Apple is facing a “code red” situation in China and the right pricing strategy around XR and future versions will be key to putting a ring fence around the core installed base in the region. With lower priced competition from all directions with Huawei and Xiaomi front and center, Apple needs to make sure that over the next few quarters they do not lose any current iPhone customers and thus speaks to the more significant price reductions on the way.
Wedbush also suggested that Apple is planning to release its streaming video service sooner than expected in an attempt to win over the Chinese market.
Nora Reynolds is a major in biology and a minor in Biological Basis of Behavior, writing about science in general. She also likes to try new gadgets and sports about the AI new era.
