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Apple to Ship 4M Fewer iPads After Market Share Drops to 35% (AAPL)

Apple to Ship 4M Fewer iPads After Market Share Drops to 35% AAPL
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Apple (NASDAQ: AAPL) may ship fewer iPads in the September quarter to compensate for the decrease in demand.

According to market intelligence firm TrendForce, the entire industry has been affected by waning interest from consumers. The market for seven-inch tablets with a resolution of at least WSVGA (super video graphics array) fell 12.4 percent during the June quarter, with shipments topping out at 41.1 million units.

Seasonality (fewer tablets are purchased in the spring than in the fall) and the generational gap (some consumers were likely waiting for new models to be released) are being attributed to the decline in tablet shipments.

Related: iPad 5 Likely to Use New, Lighter and Thinner Technology

Eric Chiou, a research director at WitsView (the display research division of TrendForce), places more specific blame on Apple's declines. In the report, Chiou said that he saw the full-size iPad enter its end of life cycle during the June quarter.

With iPad sales falling to just 14.6 million units last quarter (compared to 17 million during the year-ago period and 19.5 million units in the March quarter), Apple's market share has dropped to its lowest level yet.

During the second quarter, Apple commanded just 35.5 percent of the global tablet market.

After selling 8.8 million tablets, Samsung's (OTC: SSNLF) market share came in at 21.4 percent.

Asus' market share arrived at 3.9 percent (1.6 million tablets shipped), while Google's (NASDAQ: GOOG) was at 1.7 percent (700,000 tablets shipped). Google does not manufacture its owns tablets, so those shipments could be attributed to Asus and Samsung.

Microsoft (NASDAQ: MSFT), which recently announced a $900 million write-down on Surface RT, sold 900,000 tablets during the period. This allowed the Windows maker to grab 2.3 percent of the market.

According to DigiTimes, the situation may not improve much in the September quarter.

Upstream supply chain sources claim that Apple will only ship 10 million to 12 million iPads during the summer months (which corresponds with Apple's fiscal 2013 fourth quarter). If Apple's shipments are limited to 10 million units, it is unlikely to sell many more than that unless several million units are already sitting on store shelves.

That being the case, iPad sales would end up declining another 30 percent.

Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis(at)benzingapro(dot)com. Follow him @LouisBedigianBZ

Posted-In: Amazon Apple Digitimes Eric Chiou iPadNews Rumors Tech Best of Benzinga


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