How to buy a new smartphone in 2019


Buyers of the Apple iPhone 6 and iPhone 6 Plus have been hit with a new problem, with the company now reporting an unprecedented $4.6bn write-down on its smartphone portfolio.

The write-off of the value of its iPhone portfolio was reported by The Wall Street Journal on Thursday, citing people familiar with the matter.

“Apple has taken a $4 billion write-on on its $16.5 billion smartphone portfolio, according to people familiar.”

Apple, which is in the process of closing a $1.3bn buyout of Beats Electronics, is now expected to announce on Thursday that it has sold its stake in Beats Electronics to private equity firm Andreessen Horowitz, which also owns tech firm XoT.

The Wall Street journal reported that the write-offs were not part of Apple’s financial statements for fiscal 2019.

Apple said it would publish its financial results for fiscal 2020 on Friday, which will be its third annual report since it bought Beats.

Analysts are split on the impact of the writeoff, with some saying the company’s smartphone portfolio is in good shape, while others said it is a blow to the company.

Analytics firm Forrester Research said the write off of $4bn in value is “a massive loss for the iPhone”.

“We think this is a sign of the times, as a whole Apple has lost significant value on its iPhone business, and now its likely to face the same sort of challenge with Beats,” it said in a report.

“With the Beats acquisition and its likely follow-on, Apple will have to sell off some of its other mobile hardware businesses, and in doing so, it may find itself with significantly less cash than it needs to make significant investments in the iPhone, or other mobile products.”

Analysts have also predicted that Apple will lose about $2bn in revenue in 2019 as a result of the Beats buyout.

Analytical firm Gartner said in its most recent quarterly iPhone and iPad smartphone report that the “Apple iPhone 6 is currently the most profitable smartphone ever in the US, with sales of the iPhone 6 being driven by the new Apple Pay service, with over $100bn in iPhone 6 revenue generated in the last quarter.”

Apple has been struggling to win over new buyers with its new iPhone lineup, which has been plagued by poor reception and complaints about the software.

The new iPhones have been beset by issues with screen and battery life, and have also been criticised for being more expensive than their competitors.

“The iPhone 6s is the best iPhone ever,” said James Martin, chief executive of the smartphone retailer CNet, in September.

“It’s the best camera on the market, the best audio experience, and it’s the most affordable phone on the planet.”

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