Apple might lose $10 billion because of the throttling scandal

- Adrian Ungureanu
1077

You already know the story. Apple decided to ”protect older iPhones with aged battery from malfunctioning” but the way they acted bothered a lot of fans around the globe.

The company admitted that it was slowing down the older iPhones to prevent further damages to the aged batteries and to prevent accidental shutdown, and then apologized for doing it and decided to offer their clients the possibility to replace the batteries on their old iPhone at a discounted price. The prices were cut down from $75 to 29% for everyone around the world.

While the move might appease the fans rage, it’ll surely have financial consequences for Apple. In a note to investors, Mark Moskowitz of Barclays, one of the largest financial and banking groups on the world, is projecting a “significant” draw from iPhone sales in favor of subsidized battery replacements at $29 apiece.

The analysts suggests that as soon as the phones will get new batteries will speed up again, thus making their users feel less compelled to change their older iPhones, with new models. “Due to the large base, even a small percentage opting for battery replacement over upgrade could have meaningful impact on iPhone sales,” Moskowitz writes.

On a conservative estimate of a 519 million eligibility base for these discounted repairs as of the end of 2017, Barclays models a 10 percent adoption rate over the course of the year and a 30 percent drop in upgrades. This could mean a sales impact of 16 million new units in 2018, creating about a 4 percent or $10.3 billion slip from the bank’s forecast for iPhone revenues.