Expansion services Apple "bet" software patents

Nanjing Hua News: Apple announced its financial report after trading yesterday local time, recording the first annual revenue decline since 2001. However, iPhone 7 revenue was not included in the previous quarter's earnings. Apple said it was optimistic about its quarterly earnings, benefiting from strong sales of the iPhone 7.

More software innovation than hardware

However, Nanjing Huaxun US patent analysts believe that the iPhone 7 does not have many substantial innovation breakthroughs, so the boost to Apple's financial report is limited. Lu Junkuan, chief analyst at Gartner, told CBN, "The iPhone 7 still looks like a more ordinary replacement cycle at the moment, so it won't bring a big turnaround to Apple's earnings. It's only the next generation of iPhone products that are likely to bring a bigger round of replacement."

An industry insider who pays close attention to Apple revealed to Nanjing Huaxun: "We have checked its patents and have not seen a breakthrough in transcendence." The source said that the application for a patent for an invention takes two years and an announcement is required in the middle. "We have checked the future of Apple patents, the majority of software, no breakthrough in hardware." He believes Apple's earnings will continue to decline.

Over the past decade, thanks to the growth of the iPhone, Apple has grown into the world's largest company by market capitalization. But this successful model has been challenged in the past two years. With the saturation of the global smartphone market, Apple's iPhone 6S sales have declined sharply, especially in China. China is Apple's fastest growing market in recent years.

The fiscal quarter ended September 24 was also Apple's third consecutive quarter of declining revenue and earnings. In the quarter, Apple's profit fell 19% to $9 billion from $11.1 billion in the same period last year, and the benefit per share fell from $1.96 to $1.67. Revenue also fell 9% to $46.9 billion, but it is still the most profitable company in the United States.

In the past three months, Apple sold a total of 45.5 million iPhones, 2.5 million fewer than in the same period last year. In the upcoming fiscal year, although iPhone revenue still accounts for 63% of Apple's total revenue, the market has undergone fundamental changes. The competitive environment in the smartphone market has become more intense, and consumers' purchase habits and needs have also occurred. change. Whether Apple can adapt to the new business environment has become the key to its future success.

Apple's outlook for the iPhone 7 is optimistic, the iPhone 7 is expected to bring Apple's quarterly earnings of $76 billion to $78 billion in revenue. Cook (Tim Cook) said: "although some iPhone 7 products are out of stock, but still does not affect the quarterly earnings to achieve growth." Cook said last month in response to the iPhone 7 Plus out of stock, the iPhone 7 is a record, some high-end models do need to wait for a while.

In this regard, Lu Junkuan said: "Apple's new iPhone out of stock is not uncommon, and this cannot be considered a hunger marketing." But the wait time for some high-end models of the iPhone 7 is even as long as two months, which is a relatively rare situation in the past. Lu Junkuan also said: "The biggest change in Apple in the past few years is fingerprint recognition, but after the iPhone 6, it is only following the trend of large screens. There has been no breakthrough innovation for many years. I hope there will be amazing products next year. appear."

The Indian market will replace China

Although hardware is still Apple's main growth momentum, Apple is trying to expand its share of the services business, including Apple Music, iTunes and Apple Store. This is also Apple's fastest growing area. In the fourth quarter, service revenue increased 24% from the same period last year, and Apple's music revenue increased 22%. Become the only bright spot in the financial report. Sales of the rest of the products, including Mac computers, iPad and Apple Watch, fell. Among them, Mac computer sales fell 17% year-on-year, while Apple watch sales fell 22% year-on-year.

The bigger challenge for Apple comes from China. The success of the iPhone over the past decade now seems hard to replicate. In the past three months, Apple's revenue in Greater China, including Hong Kong and Taiwan, has fallen by 30% to US $8.8 billion. In the same period last year, revenue doubled year-on-year. Such a gap is hard to accept. Nanjing Hua Xun US patent analysis said: "80%-90% of China's potential high-end smartphone users already own mobile phones."

Given the slowdown in the Chinese market, Apple is gradually shifting its focus to India. In the past fiscal year, sales in India have grown by 50%, making India an important market for Apple after China. In 2015, only 16% of India's population owned smartphones, which is far from the world average of 44%. That means Apple will have a huge market there.

Apple has announced the opening of its first retail store in India and the establishment of a research and development center. In addition, Apple has partnered with Indian telecom service Reliance Jio, which is building an all-IP 4G network and offering iPhone users a year of free service. The network will cover 18000 cities and 200000 villages around the world.

Despite the difficulties, Apple has welcomed some good news recently, such as Samsung's accidental explosion, which is a huge benefit to Apple. Cook has publicly stated: "Many Android users have turned to Apple, and they want a better experience." In the past three months, boosted by the explosion of iPhone 7 and Samsung, Apple's share price has risen by 20%.