Every year, for the past eight years, Apple has delivered a steady increase in iPhone sales. Now, for the first time, that growth rate has stopped — but is this a momentary pause, or a long-term trend?

There’s evidence for both arguments. On the one hand, Apple’s fiscal year Q1 2015 results were extremely strong. Growth surged from 2014 to 2015, thanks to massive demand from China, favorable exchange rates, and pent-up demand for larger smartphones from Apple’s own user-base. Remember, last year was the first time Apple had ever offered a large-screen device, and iPhone 6 Plus sales were stellar.

Also read : Apple's own code suggests of losing headphone jack in iPhone 7
Apple-Sales
Apple-Sales
Data by Gizmodo
Looking at the data, we see that the leap in iPhone sales from calendar year 2014 – 2015 was unusually large, and therefore unlikely to be repeated two years in a row. Apple’s iPhone business is extraordinarily healthy, with more than $51.64 billion in sales just this past quarter.
At the same time, however, there’s news suggesting that the upgrade cycle that’s been fueling phone sales across the US and Europe is slowing rapidly. According to Apple’s own figures, just 40% of its current users have upgraded to an iPhone 6, 6s, or one of the iPhone Plus models. Again, a 40% conversion rate at the top of the smartphone market is probably something Samsung would kill for, given two straight years of slumping Galaxy flagship sales.
The difference between Samsung and Apple, in this case, is that much of the iPhone 6 family’s popularity was chalked up to aggressive China expansion and pent-up demand for a large-screen device. Samsung’s first Galaxy Note rolled off the line in late 2011, and multiple versions of the hardware are still sold today.

The phone market is entering new territory
There are two reasons I think both iPhone and Android users are slowing their upgrades, at least in the United States. One is the death of phone contracts. Until quite recently, most Americans bought new devices at the two-year mark with a substantial up-front discount. (Whether this was a good deal depends mostly on what kind of plan you had.) The contract market has largely been phased out at the major US carriers, in favor of models in which you either buy the phone upfront or pay a monthly fee for it over a 1-2 year period.
The net effect of this process is that some people may be upgrading less often, or at longer intervals. If you bought the original iPhone 3G when it first came out, for example, Apple could count on an upgrade from you with the 4s, 5s, and 6s cycles. Now, this bump is going to be more evenly distributed.
The second major issue is the fact that smartphones just aren’t improving like they used to. This was an inevitable consequence of the platform’s evolution — the bundle of technological improvements we refer to collectively as Moore’s Law has been slowing for years, and battery life improves by just 3-5% per year over the long run. Beautiful displays and fast multi-core processors are fabulous, but once the app revolution had run its course, people settled down into predictable usage patterns. A smartphone from 2013 could stream content, run games, and surf the web in ways a 2009 device could never match. A 2016 smartphone can do those things a little faster, with a few more bells and whistles. True must-have features are few and far between.
The smartphone upgrade cycle will probably always be shorter than its tablet or desktop equivalent — phones are used more roughly and screens are delicate. Apple, to-date, hasn’t had to grapple with the same difficulties as Samsung, but the mobile industry is growing up. Phones will continue to get better at what they do already, but there’s little reason to upgrade a several year-old device if it still meets your needs.
This is one reason why so many manufacturers are pushing so hard to create wearable devices. With tablet sales falling and smartphone growth sputtering, rapid adoption of wearable computing would create a new market for devices — devices which would then go through their own 6-10 cycle of rapid improvement and meteoric growth.
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