Apple has made a number of small mistakes over the past few years that, combined with some adverse market trends and the death of Steve Jobs, have led to Apple’s stock getting clobbered.
We’ve described many of these factors in detail:
- A gradual loss of supremacy in the smartphone market (relatively slow innovation and new product rollouts that allowed competitors to catch up)
- A decision not to launch a lower-price iPhone that is affordable in emerging markets, where the hyper-growth in the smartphone industry has migrated in the past few years
- A decision to protect profit margins at the expense of market share, pricing, and aggressive investment in future products
- In the tablet market, the abandonment of the “best price AND best product” combination that made the iPad the only viable tablet choice in the first couple of years (now, other excellent tablets are cheaper)
- Relatively weak offerings in apps and services, which have allowed Google and other competitors to gain stronger footholds in mobile
- Taking too big a cut of app and content revenue, which has prompted some developers to try to find ways to avoid the iOS ecosystem
None of these by itself was a big issue. But, together, they added up to a stock that got ahead of itself in 2012 on the strength of a few of quarters of spectacular iPhone profitability, followed by a severe margin compression that caused the stock to get cut in half.
But in addition to all of these small issues, there is also evidence to suggest that something big has gone wrong at Apple over the past year. And that something, we would guess, is likely problems with the launch of a major new product category–namely, Apple’s television set.
In his last few public presentations, Apple CEO Tim Cook has been on the defensive about one main issue, which is Apple’s lack of new products launches this year.
And these questions are understandable.
As the chart below shows, Apple is in the midst of an unprecedented drought in terms of new product launches.
As BI’s Jay Yarow observed earlier this year, by the time Apple’s developer conference, WWDC, rolls around in a couple of weeks, Apple will have gone a staggering 230 days between new product announcements. That’s more than twice as long as any new product gap in recent history. And it’s 3-4 times as long as Apple’s normal new-product gap over this period.
Given Apple’s extraordinary skill at developing, manufacturing, and launching new products, we highly doubt that this drought was planned.
Rather, we suspect that had planned to launch a major new product late last year or early this year, one that would have carried the company through this drought.
And based on all the reports about an Apple television that hit the market early last year–most of which predicted that Apple would launch its TV in the 2012 holiday season (or at least announce it and then start selling it early in 2013)–we’d bet that that major new product was intended to be Apple’s TV.
Alas, for unknown reasons–perhaps having to do with the TV industry’s refusal to meet Apple’s distribution demands–the predictions for the arrival of the TV have now been rolled forward a year, to late 2013 or early 2014.
Given Apple’s secrecy, we may never know for sure why the company has effectively gone at least nine months without launching a significant new product. But looking at the chart above, it seems likely that a product that was expected to launch earlier this year took longer than expected to become a reality.
Disclosure: I own Apple stock.