The Wall Street Journal says Apple has slashed prices of the iPhone XR in Japan amidst poor sales. It's the latest report of soft sales for the newest iPhones, which consumers seem to find overpriced.
Many iPhone users upgrading their phones are buying last year’s cheaper iPhone 8 instead of the XR, the WSJ says. To try to change this, Apple is offering discounts on the XR in the form of subsidies to Japanese carriers.
The report also says Apple will resume production of the original iPhone X to meet contractual obligations to its OLED screen provider, Samsung Display.
As it often does, Apple signed a contract to buy a large quantity of OLED displays for iPhones at a discount. Since sales of the new models have been less than projected, Apple has a glut of screens it needs to use. The solution seems to be to resurrect the original iPhone X, which will now reportedly be cheaper to make.
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Why not just sell at the right price?
The iPhone XR price slash in Japan may be a sign of things to come. Apple sells each new generation of phones at a markup, but this time, consumers don’t seem to find the new features appealing enough to justify the prices.
The Wall Street Journal previously reported that Apple cut production orders on all new 2018 iPhones, which caused share prices of Apple and its suppliers to fall sharply. Apple also announced that it wouldn’t report iPhone sales anymore. (This chart may explain why.)
No one expects Apple to implode anytime soon, but this new report of price cuts in one of its top markets is hard to ignore.