iPhone 8 sales faring well against iPhone X hype: BayStreet

The iPhone 8 went on sale in late September.(Apple)

While much of the market’s attention has been tuned to the launch this week of Apple’s $1,000 iPhone X, at least one analyst believes that the somewhat maligned iPhone 8 and 8 Plus phones are selling far better than most expected. Specifically, BayStreet Research said that iPhone 8 and 8 Plus retail sales are down only 30% compared with sales of the iPhone 7 last year.

“I would have expected a much bigger decline,” said Cliff Maldonado, an analyst at BayStreet, which tracks sales of smartphones.

BayStreet reported that iPhone 8 pre-orders were down fully 60% from the iPhone 7 last year, which Maldonado said makes sense because Apple fans keen to obtain the company’s latest gadget likely would go for the iPhone X rather than the iPhone 8 with their preorders. However, Maldonado said that, when the iPhone 8 went on sale in retail stores, it enjoyed healthy sales from shoppers swinging by to grab Apple’s latest product.

“The gravitational pull from the Apple products is really strong,” Maldonado said. He also said that the 8 Plus was the most popular of the two models, with 57% of shoppers opting for the bigger phone.

Apple announced the iPhone 8, 8 Plus and X in September. The 8 and 8 Plus offer only incremental upgrades, but the iPhone X offers a number of noteworthy features, including facial recognition and an edge-to-edge screen. Apple began shipping the 8 and 8 Plus in late September and the X on Nov. 3.

As for the iPhone X, initial sales of the device appear strong. As Axios noted, more people are using an iPhone X now than after the first weekend of sales of the iPhone 8, according to data from mobile engagement firm Localytics.

“The iPhone X grabbed 0.93% of the overall market share for iPhones after the first weekend of sales," Localytics said, according to Axios, adding though that that figure is lower than initial launches of the iPhone 6, 6S and 7. “While this may seem slightly concerning, it's important to consider that there are significantly more iPhones in the market today than in 2014. While the iPhone 6 was a major upgrade at the time, it did not pack the punch that Apple has introduced with the iPhone X. If Apple's prediction that the 2017 holiday quarter will be one of its best ever comes true, it's likely we will see adoption of the X grab more of the overall market share than its predecessors did after the first months in the market.”

Indeed, Counterpoint Research and Wave7 conducted multiple point-of-sale surveys of the U.S. market during the iPhone X launch weekend, and found that store traffic appeared higher than any iPhone launch since 2015.

During the company’s recent quarterly earnings conference call, held prior to the launch of the iPhone X, Apple CEO Tim Cook declined to comment on specific sales of the iPhone 8 vs pre-orders of the iPhone X, but noted that the iPhone 8 and 8 Plus “instantly became our two most popular iPhone models [after launch] and have been every week since then,” according to a Seeking Alpha transcript.

Further, according to some analysts, there weren’t very many iPhone X units to go around this week. “The bigger story was the lack of iPhone X inventory at wireless operator stores,” wrote BTIG analyst Walt Piecyk in a post following the launch of the iPhone X. “The operators joined the Apple stores in opening early for the launch, but in some cases were only able to offer 3 or even no iPhone X for walk-in customers. The lack of inventory might normally cause some concern for Apple investors, but the December guidance provided by Apple management on last night’s earnings call has clearly allayed those concerns about the impact of tight shortages on revenue.”

Piecyk said that BTIG raised its price target for Apple to $198 on higher iPhone estimates.