Apple Revises Q1 Financial Guidance Following Poor iPhone Sales

In a letter to investors, Apple CEO Tim Cook has stated that the company has revised its financial guidance for the holiday fiscal quarter that ended on December 29th as follows:

  • Revenue of approximately $84 billion
  • Gross margin of approximately 38 percent
  • Operating expenses of approximately $8.7 billion
  • Other income/(expense) of approximately $550 million
  • Tax rate of approximately 16.5 percent before discrete items

We expect the number of shares used in computing diluted EPS to be approximately 4.77 billion.

Here’s the guidance that Apple gave November 1, 2018 when it reported its fourth quarter 2018 results:

  • revenue between $89 billion and $93 billion
  • gross margin between 38 percent and 38.5 percent
  • operating expenses between $8.7 billion and $8.8 billion
  • other income/(expense) of $300 million
  • tax rate of approximately 16.5 percent before discrete items

That’s a miss of $5-9 billion in revenue. Cook’s letter is lengthy, but the lion’s share of the problem comes down to lower than expected iPhone revenue:

Lower than anticipated iPhone revenue, primarily in Greater China, accounts for all of our revenue shortfall to our guidance and for much more than our entire year-over-year revenue decline. In fact, categories outside of iPhone (Services, Mac, iPad, Wearables/Home/Accessories) combined to grow almost 19 percent year-over-year.

While Greater China and other emerging markets accounted for the vast majority of the year-over-year iPhone revenue decline, in some developed markets, iPhone upgrades also were not as strong as we thought they would be. While macroeconomic challenges in some markets were a key contributor to this trend, we believe there are other factors broadly impacting our iPhone performance, including consumers adapting to a world with fewer carrier subsidies, US dollar strength-related price increases, and some customers taking advantage of significantly reduced pricing for iPhone battery replacements.

Although there have been rumors of lackluster iPhone sales for weeks based on supply chain leaks, a miss of this magnitude caused by falling iPhone revenue is still a big surprise, which is no doubt why Apple chose to address the issue before its next earnings report is released.

Macworld Profiles Mac Apps Developed for Over 25 Years→

As we start a new year that could bring significant change to macOS, Glenn Fleishman, writing for Macworld, spoke to the creators of four Mac apps – BBEdit, PCalc, Fetch, and GraphicConverter – that have been around for at least 25 years and weathered a variety of past macOS and hardware transitions.

Rich Siegel of Bare Bones Software, which can trace BBEdit’s lineage back to 1989 when the app was built for System 7, told Macworld that over the years:

We’ve extensively rewritten, upgraded, and optimized [BBEdit’s] internal architecture.… Even though it has evolved a great deal, BBEdit has stayed very close to its fundamental mission: empowering its users to accomplish tasks which would challenge or defeat other tools.

Not long after BBEdit came on the scene, James Thomson released the first version of PCalc on the Mac, which was also built for System 7. For Thomson, PCalc’s evolving UI has kept working on the app fresh:

My passion since I first discovered the Mac nearly 30 years ago has always been making interesting and fun user interfaces. And look forward to keep doing it for a long time to come.

Fleishman also spoke to Jim Matthews, for whom FTP client Fetch has gone from full-time job to side project over the years, and Thorsten Lemke, whose GraphicConverter app has evolved from converting a handful of image formats to over 200.

Twenty-five or more years on one app is a remarkable accomplishment. The story of each app is different, but their developers share a common commitment to maintaining their apps for their customers notwithstanding the changes to the Mac and its OS over the years. Later this year, we should hear more about Apple’s plans to help iOS developers bring their apps to the Mac App Store. Whatever impact those changes end up having on the Mac app ecosystem, I hope the sort of developer dedication that has kept BBEdit, PCalc, Fetch, and GraphicConverter around for over a quarter century perseveres.

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WinterFest 2018: Great Deals on Pro Mac Apps and Books [Sponsor]

Hosted by Tinderbox maker Eastgate, WinterFest 2018 is an amazing collection of carefully-crafted productivity apps and books available for a limited time for 20-25% off.

The 17 apps and books span the entire spectrum of the research and writing process. There are apps to plan your next big project, track your time, discover research materials, organize your research, add and tag images to your project, write, and more.

Each app is hand-crafted by some of the best Mac developers around. WinterFest includes:

  • Tinderbox – Visualize and organize ideas and plans.
  • Panorama X – Collect, organize, and understand your data.
  • Nisus Writer Pro – The powerful word processor for the Mac.
  • DEVONthink Pro Office - Your paperless Mac office.
  • Aeon Timeline 2 – The timeline tool for creative thinking.
  • TextExpander – Recall your best words. Instantly, repeatedly.
  • Take Control Books – Essential books about Mac, iOS, and key apps.
  • Storyspace – Serious hypertext narrative.
  • Bookends –The reference manager you’ve been looking for.
  • Scapple – Quickly capture and connect ideas.
  • PDFpen – Powerful PDF editing.
  • HoudahSpot – Powerful file search for Mac.
  • HoudahGeo – Photo geotagging.
  • DEVONagent Pro – Your smart (re)search assistant.
  • BBEdit 12 – Power tool for text.
  • ImageFramer Pro – Your art. Showcased.
  • Timing – Automatic time tracking for Mac.
  • Scrivener – Your complete writing studio.

Saving hundreds of dollars on these fine tools couldn’t be simpler. Visit the WinterFest website to learn more about each and purchase Eastgate’s Tinderbox and Storyspace. For everything else, just use the coupon code WINTERFEST2018 at checkout to take advantage of these fantastic deals.

Our thanks to WinterFest 2018 for sponsoring MacStories this week.

MacStories Selects: The Best New Accessories of 2018

iOS devices and Macs sit at the center of our computing lives, often accompanied by a host of accessories. And each year brings a few standout new accessories that extend what our favorite devices can do in meaningful ways – 2018 was no exception. From dongles and hubs to cameras and headphones, the MacStories team tried a wide range of gadgets this year that made an impact on our daily lives. Below is our favorite, along with our runners-up.

Best New Accessory

Netgear Orbi Outdoor WiFi Satellite

John: There are few aspects of my computing life more important than a reliable, fast connection to the Internet. There are several good options available when it comes to WiFi mesh networking systems, but it’s Netgear’s Orbi Outdoor WiFi Satellite that makes its system stand out and has added the kind of flexibility to my setup this year that wasn’t possible before.

Federico and I both use Netgear’s Orbi WiFi router and indoor satellite to blanket our homes in WiFi. I started with an Orbi router and one satellite. The router sits in my basement where our Comcast service enters the house, the satellite sits in the kitchen, and recently, I added an Orbi Wall-Plug on the second floor. That combination of Orbi devices alone has been enough to blanket the interior of my house in fast WiFi and handle around 40 connected devices when my entire family is home.

This past January at CES, Netgear announced it was adding to the Orbi lineup with the Orbi Outdoor Satellite, an extender for the Orbi router designed to withstand the elements. Admittedly, there’s probably no one more susceptible to the promise of outdoor WiFi than me sitting at home staring out at the snow while reading roundups of CES gear. Still, I waited until the device was released and reviewed before finally giving in early this past summer.

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Jason Snell Goes Hands-On with Brydge’s Upcoming Keyboard for the 2018 iPad Pro→

Jason Snell tested a pre-production unit of the Brydge keyboard for the 2018 iPad Pro (in the 12.9” flavor) and it sounds like this will be the iPad keyboard worth waiting for:

To attach the iPad to the Brydge 12.9 Pro, you slide it into two hinged clips covered with rubber padding. As with previous models, it takes a little practice to get the feel right. My main concern once the new iPad Pro was unveiled was if Brydge would be able to design a clip small enough to only cover the iPad’s much smaller bezels that also held the iPad securely. I’m happy to report that the answer is yes—there’s enough room and once the iPad is attached, the connection feels solid.

The clips are the same size front and back, meaning you can remove the iPad, flip it around, and insert it back into the clips to use the Brydge as a “movie mode” stand, or even fold it down and use it as a double-thick, double-weight tablet. (I don’t really see the appeal, but Brydge says that some customers requested it.)

In a nice touch, the Brydge 12.9 Pro comes with a slight indentation at the bottom of the wrist-rest space (below where a trackpad would be, if it had a trackpad). This creates a natural lifting point to open the “laptop”, which was sometimes tricky on the previous models.

Once I was able to get my hands on a functioning unit of the original Brydge keyboard, I fell in love with the idea of turning the iPad into a “convertible” computer that could work both as a laptop and a tablet. I later upgraded to the second-generation Brydge keyboard and used it until I upgraded to the latest iPad Pro in November. Products like the Brydge keyboard tie into the iPad’s hybrid nature – the multiplicity of input systems and work contexts that make it, as Jason also notes, more flexible than a traditional laptop or desktop computer. I was concerned that the smaller bezels of the 2018 iPad Pro were going to be an issue for a redesigned Brydge keyboard, but it seems like the company has not only worked around the iPad’s new design constraints, but even improved upon previous generations of the keyboard case. I’m going to pre-order one as soon as possible.

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Connected, Episode 224: 2018 in Review→

A look back at 2018: our predictions and a review of the news that mattered, as well as some that didn’t.

On the final episode of Connected for the year, we look back at all the major Apple news and announcements of 2018. You can listen here.

Sponsored by:

  • Pingdom: Start monitoring your websites and servers today. Use offer code CONNECTED to get 30% off.
  • PDFpen, from Smile: The ultimate tool for editing PDFs. Click here to learn more.
  • Kane 11: Premium socks in precisely your size. Get 20% off your first order.
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iA Writer 5.2: Better Typography and External Library Locations

As I wrote in my roundup of must-have iOS apps, I’ve been using iA Writer as my text editor, primarily because of its integration with Working Copy, beautiful typography, and syntax highlighting mode. As a non-native English speaker, I find the latter particularly useful when editing articles. iA Writer was updated to version 5.2 last week, and I’d like to point out a few welcome enhancements in this release.

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WinterFest 2018: Great Deals on Pro Mac Apps and Books [Sponsor]

Hosted by Tinderbox maker Eastgate, WinterFest 2018 is an amazing collection of carefully-crafted productivity apps and books available for a limited time for 20-25% off.

The 17 apps and books span the entire spectrum of the research and writing process. There are apps to plan your next big project, track your time, discover research materials, organize your research, add and tag images to your project, write, and more.

Each app is hand-crafted by some of the best Mac developers around. WinterFest includes:

  • Tinderbox – Visualize and organize ideas and plans.
  • Panorama X – Collect, organize, and understand your data.
  • Nisus Writer Pro – The powerful word processor for the Mac.
  • DEVONthink Pro Office - Your paperless Mac office.
  • Aeon Timeline 2 – The timeline tool for creative thinking.
  • TextExpander – Recall your best words. Instantly, repeatedly.
  • Take Control Books – Essential books about Mac, iOS, and key apps.
  • Storyspace – Serious hypertext narrative.
  • Bookends –The reference manager you’ve been looking for.
  • Scapple – Quickly capture and connect ideas.
  • PDFpen – Powerful PDF editing.
  • HoudahSpot – Powerful file search for Mac.
  • HoudahGeo – Photo geotagging.
  • DEVONagent Pro – Your smart (re)search assistant.
  • BBEdit 12 – Power tool for text.
  • ImageFramer Pro – Your art. Showcased.
  • Timing – Automatic time tracking for Mac.
  • Scrivener – Your complete writing studio.

Saving hundreds of dollars on these fine tools couldn’t be simpler. Visit the WinterFest website to learn more about each and purchase Eastgate’s Tinderbox and Storyspace. For everything else, just use the coupon code WINTERFEST2018 at checkout to take advantage of these fantastic deals.

Our thanks to WinterFest 2018 for sponsoring MacStories this week.

My Must-Have Mac Apps, 2018 Edition

Last year when I wrote about my must-have Mac apps, I was coming off a tumultuous year that started with a daily commute into Chicago for my old job and ended with me working from home. As the year came to a close, I was exploring what that meant for the way I work on the Mac.

That process continued into 2018. With the number of new things I took on in 2017 and the transition to indie life, I made the conscious decision to step back and settle into my new life. That wasn’t easy. There’s a natural tendency to take on everything that crosses your path when you go out on your own, but I’ve seen too many people fall into that trap in the past. Instead, I concluded that 2018 would be the year to improve the way I already work by refining existing workflows and reevaluating how I get things done, including on the Mac.

Three events led me to work on my Mac more in 2018. The first was the 27-inch LG 4K display I bought in January. It was a big step up from the 23-inch 1080p one I had before and, combined with a VESA arm, improved working at my Mac substantially.

The second factor was our MacStories coverage of the App Store’s tenth anniversary. For it, we produced seven extra episodes of AppStories that were released in the span of one week, which kept me in front of my Mac recording and editing for long periods of late May through June.

Third, just after WWDC, I destroyed the screen of my iPad Pro thanks to the trunk hinges that invade the interior of the 2016 Honda Accord.1 I decided to hold out for the new iPad Pros, but that meant writing for four of the busiest months at MacStories without a good iOS work solution. I used a current-generation 9.7-inch iPad some, but it couldn’t compete with my LG display.

As 2018 comes to a close, the changes I’ve made haven’t been dramatic despite the extra time I’ve spent in front of my Mac. Instead, I’ve fine-tuned existing workflows and added new apps for specific tasks.

Below, I’ve broken down the 49 apps I use roughly by activity and function. I’ll mention where Apple’s apps fit into my workflow as I go because without them there would be a few big holes in the landscape of apps I use, but the focus of this roundup is on third-party apps, not Apple’s.

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  1. I’m right there with you on this one John. ↩︎