iPhone 5 Rumors to Blame for Apple’s Slow Sales

Today’s mobile news roundup features: Apple’s low iPhone sales; Samsung Galaxy SIII receiving an OTA update; and AT&T reporting increased profits.

iPhone sales down as iPhone 5 rumors skyrocket

Apple delivered their quarterly financial report and as expected, iPhone sales are down.  The culprit behind this is the skyrocketing rumors regarding the unveiling of the next iPhone, which everyone expects to happen sometime in late September or early October.

“Our weekly iPhone sales continue to be impacted by rumors and speculation regarding new products,” said Apple Chief Financial Officer Peter Oppenheimer.

Apple stated that they sold 26 million iPhones in the quarter that ended on June 30, a 28 percent increase from the same quarter of the previous year.  But it’s remarkably lower than the 35.1 million sold in the previous quarter of this year.

Apple also reported that revenue rose 22.6 percent to $35 billion from a year earlier but that number is down from 59 percent compared to the previous quarter.  Apple’s profit increased by 20.7 percent to $8.8 billion, or $9.32 a share, compared to the previous year but it is down from a 94 percent growth the previous quarter.

Mac computer sales are up by 2 percent, selling four million units, but their iPod sales are down by 10 percent, selling only 6.8 million units.  Good news is, they’ve sold 17 million iPads, up by 44 percent from 11.8 million previous quarter.  The increase in iPad sales is attributed to the launch of the new iPad in the previous quarter.  As for their Apple TV, CEO TIm Cook still has high hopes for the device even though they only sold 1.3 million Apple TV devices.

“It’s still at a level we would call it a hobby, but we continue to pull strings to see where it takes us,” Cook said. “There are a lot of people here that are believers in Apple TV and we continue to invest in it.”

In other Apple news, they’ve released the Mac OS X 10.8 Mountain Lion operating system.  They have more than high hopes for their new OS since their previous OS, the Lion, did amazingly well.

“The pace of innovation on the Mac is amazing, OS X Mountain Lion comes just a year after the incredibly successful launch of Lion,” said Philip Schiller, Apple’s SVP of Worldwide Marketing, at WWDC last month.

“With iCloud built right in and the new Notification Center, Messages, Dictation, Facebook integration and more, this is the best OS X yet.”

Samsung Galaxy SIII’s curious update

Samsung pushed an over-the-air update to international users of the Galaxy SIII.  Samsung dubbed the update as a “stability update” for the Android 4.0 Ice Cream Sandwich device, but what it really does is removes local search functionality from the device.  So if you’re using a Galaxy SIII and choose to upgrade your software, you might be surprised that the next time you search for something, local results won’t come up.

This is seen as a preemptive move against Apple, who has a  local search patent.  Though their current court litigations does not include the feature, it’s better to be prepared than sorry.  The upside of the upgrade is that it makes your Galaxy SIII perform generally faster.

AT&T’s increased profits due to increase in smartphone use

AT&T reports a second-quarter profit increase of 8.7 percent as more people are now getting mobile.  Just like Verizon, they also reported that the majority of their subscribers are now smartphone users.

AT&T reports that their wireless service margins rose to 30.3 percent compared to last year’s 26.9%; revenue from wireless data increased 19 percent to $6.4 billion; and the churn or the rate customers leaving their service dropped to 0.97 percent from last year’s 1.15 percent.

They reported a profit of $3.9 billion, or ¢66 a share, up from $3.59 billion, or 60 cents, the previous year.  Revenue rose 0.3 percent to $31.58 billion while wireless revenue rose 4.8 percent to $16.35 billion.

“All in all, it was a very positive quarter which puts us in a great position heading into the second half of the year,” Chief Financial Officer John Stephens said in a conference call Tuesday.