Apple’s latest earnings call revealed record earnings for the first quarter of this year, but predict some not-quite-so-great news for later on in the year. Due to a number of factors, Apple is preparing for a dip in its external profits.
Tim Cook pegged this expected shortfall to the current chip shortage, COVID lockdowns in China, inflation, falling exchange rates, and pulling out of Russia. And unfortunately, it looks like it’s set to hit consumers when the upcoming iPhone 14 is released.
But what’s all this got to do with me and iPhone 14?
Chris Caso, a reputable analyst, warned that Apple may need to increase local prices for iPhone 14. According to Caso, if exchange rates continue to fall, Apple is considering increasing prices outside of the US. This will help to stop the company taking a hit from lower dollar amounts after conversion. Good news for Apple, not so good news for anyone else.
iPhones have always been more expensive overseas due to different import charges and taxes. The UK specifically is not so kind to tech prices, with pesky VAT making devices more expensive than in the US. With falling exchange rates, the pound (and other currencies) is getting closer to the dollar. It means Apple’s overseas prices will end up closer to the dollar amount, not covering those charges, hence the price increase.
What’s all this got to do with the iPhone 14? Well, iPhone 14 is likely Apple’s next main product launch this year (besides a couple of Macs in summer, maybe). By the time any knock-on effects hit Apple, it’ll be time to tune back in to Apple Park for the September event. It’s down to poor timing more than anything else.
Apple hasn’t actually increased its iPhone prices for a while. The latest 13 Pro series launched at the same price point as the iPhone 11 Pro series in the US, and actually slightly cheaper in the UK. iPhones usually increase in price when Apple updates the feature set, so we may have been due a price hike anyway.
Just remember that the global situation may change, so Apple may no longer need to increase iPhone 14 prices outside of the US. We’ll just have to wait and see what happens come September.
