Apple’s earnings were better than expected thanks to blow-out iPhone sales.
However, iPad sales were surprisingly bad. They totally missed analyst expectations and were down 16% on a year-over-year basis.
In terms of Apple overall, investors are fine with bad iPad sales as long as the iPhone is doing well. That’s why the stock was up 8% after earnings results.
However, the iPad’s struggle is a big mystery for analysts who follow Apple.
In this chart, you can see that sales have been flat for almost two years now. We’ve charted iPad revenue on a trailing twelve months basis, which tabulates the past four quarters of sales. This way we don’t get the seasonal spikes, but rather a smooth look at annualized numbers.
There’s any number of explanations for what’s happening with the iPad — a long upgrade cycle, people don’t really need them, people are buying cheaper tablets, people are using smartphones instead — but none of those explanations feel quite right.
It’s just a big mystery right now.
Apple for its part says that iPads came in above its expectations, and it believes that consumers love their iPads. It believes that it is well positioned for the future of the tablet market, which it thinks will overtake the PC market in a few years.
Business Insider Emails & Alerts
Site highlights each day to your inbox.