If there is anything that stood out in Apple's latest financial results, that was the iPad. With an increase of sales of almost 15% measured in units and a growth of 2% of revenues, it was the star device of the quarter. The iPhone and the Mac sold more units than in the same period last year, yes, but these increases were 1.6% and 0.9% respectively. The case of the Mac is very striking, because according to Gartner the market contracted by 4.3% in the same quarter.
But let's focus on the iPad. Since the red numbers began to appear in both income and units 17 quarters ago, only 3 of them have shown the green color. And this has been one of them. What has happened to change the tables in recent months?
Goodbye iPad mini, hello new iPad
Neil Cybart, the author behind Above Avalon, has always been clear. The iPad mini was a patch that hid the deterioration of his older brother's sales for a while. But when it began to recover, the mini began to fall victim to the large screens of smartphones first and the diagonal iPhone later.
In this graph you can see how the mini cushioned the fall of the iPad of 9.7 inches, but then contributed further to the decline of the segment.
If someone asks why Apple not only has not renewed the mini but also has raised the price and capacity, this is the reason: it is still selling (at a lower rate), but does not have the same potential as the rest of your brothers. Basically, it is a device that had its moment and this one has already happened in the eyes of the company. The canvas has become too small for what comes next.
Instead, Apple has had a better idea. Replace it with the normal iPad as an input device to the iOS world, with permission from iPod touch. Another that has the days counted. This fifth generation iPad is the twin brother of the iPad Air 2, with some common components that remind us of what happened with the iPhone SE.
With the A9 chip, the fifth generation iPad will be able to take advantage of all the capabilities of apps with ARKit
The A9 chip that mounts this iPad allows it to be able to play content created with ARKit, Apple's augmented reality platform. A fact to keep in mind, since the iPad Air 2 and the last iPad mini are left out by their A8X and A8 chip respectively. The A8X is similar to the A9 but not enough.
Here is another important detail and is the average selling price of the iPad. If the units grow by 15% but the revenues are around 2%, that means that sales have focused more than the account on models below the average. It has gone from 490 to 435 dollars. Why? The reason is found in the basic iPad, which is marketed in the US with a starting price of $ 329.
Without mouse and without macOS
This new price is behind part of the growth experienced by the iPad. Luca Maestri, Apple CFO, shed some light on the matter giving some clues:
Double-digit growth in countries such as the US, Germany, Japan, France and the China region.
It has a 55% market share in the US, a percentage that goes up to 89% if we only count the tablets of more than 200 dollars.Satisfaction of between 95% and 99% in corporate users and consumers.Major deployments in companies such as Wal-Mart, where 225,000 vendors of the company will be trained with 19,000 iPads.
A 32% growth in sales in the educational market. With several schools and states renewing their plans with the iPad.On the Pro models, the corporate market has shown great interest thanks to iOS 11.Of all this, for me two things stand out. The first is that iOS 11 can not be responsible for this growth. The iPad "to dry" will be fully able to take advantage of almost all the novelties of this operating system, except those that require the Apple Pencil. But there is still a long month until iOS 11 is released publicly.iOS 11 has not yet come into play and is not a differentiator in sales this quarter
The second is that Apple has advanced (finally!) In an iOS version that gives special prominence to the iPad. Giving you a file and multitasking system that many users requested, but that remains hidden when it is not needed. And what is more important, following your own path without falling into the temptation to imitate the Mac.
Numerous technological fans affirmed that the iPad needed to adopt macOS and a mouse but keeping the multitouch screen to be relevant again. But it has not been necessary. Apple is content to leave the convertible PC market in the hands of Microsoft and its partners, one that does not finish.
The continuous fall of the PC market is joined by the fact that Surface is a popular but niche product. In the last fiscal quarter the Redmond company stated:
The benefit of Surface fell by 20 million dollars or 2%, mainly due to the reduction in sales volume, partially offset by a greater mix of premium products.