Newspaper article St Louis Post-Dispatch (MO)

Pressure Mounts on Apple to Live Up to Hype for the iPhone X

Newspaper article St Louis Post-Dispatch (MO)

Pressure Mounts on Apple to Live Up to Hype for the iPhone X

Article excerpt

SAN FRANCISCO * The iPhone X's lush screen, facial-recognition skills and $1,000 price tag are breaking new ground in Apple's marquee product line.

Now, the much-anticipated device is testing the patience of consumers and investors as demand outstrips suppliers' capacity.

Apple said Thursday that iPhone sales rose 3 percent in the July-September quarter, a period that saw the iPhone 8 and 8 Plus come out in the final weeks. Sales could have been higher if many customers hadn't been waiting for the iPhone X, which comes out Friday.

Apple shipped 46.7 million iPhones during the period, according to its fiscal fourth-quarter report released Thursday. That's up from 45.5 million during the same time last year after the iPhone 7 came out, but represents a step back from the same period in 2015, when Apple shipped 48 million iPhones in the quarter.

As with recent quarters, one of the main sources of Apple's growth is coming from its services, which are anchored by an app store that feeds the iPhone and other devices.

Revenue in that division surged 34 percent to $8.5 billion during the July-September period. All told, Apple earned $10.7 billion on revenue of $52.6 billion, compared to a $9 billion profit on revenue of $46.9 billion a year earlier.

Apple shares rose more than 3 percent in after-hours trading on Thursday.

Nonetheless, the just-ended quarter largely became an afterthought once Apple decided to release the iPhone X six weeks after the iPhone 8.

"The Super Bowl for Apple is the iPhone X," GBH analyst Daniel Ives said. "That is the potential game changer."

But it also brings a potential stumbling block. While conspiracy theorists might suspect that Apple is artificially reducing supply to generate buzz, analysts say the real reason is that Apple's suppliers so far haven't been to manufacture the iPhone X quickly enough.

Making the iPhone X is proving to be a challenge because it boasts a color-popping OLED screen, which isn't as readily available as standard LCD displays in other iPhone models. …

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