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Apple Inc. Announces (PRODUCT)RED iPhone 8 and iPhone 8 Plus

By Ashraf Eassa – Apr 12, 2018 at 9:08PM

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The tech titan makes a midcycle kicker to try to boost sales.

On April 9, smartphone giant Apple (AAPL -1.26%) announced versions of its nearly seven-month-old iPhone 8 and iPhone 8 Plus smartphones in a new red finish. Apple is expected to begin taking orders for the phones beginning April 10 and customers should be able to get their hands on them on April 13. 

This isn't the first time that Apple has introduced special (PRODUCT)RED editions of its iPhones. Last year, for example, Apple introduced PRODUCT(RED) versions of its then-flagship, the iPhone 7 and iPhone 7 Plus. 

Apple's iPhone 8 and iPhone 8 Plus in red.

Image source: Apple.

The new color is certainly intended to try to provide a midcycle boost in demand -- something that Apple's iPhone business, frankly, sorely needs.

If you're expecting miracles from the new colors, then I'd recommend keeping your expectations in check. For some context, Apple introduced its (PRODUCT)RED iPhone 7 and iPhone 7 Plus back in March of 2017 and it didn't lead to a noticeable spike in iPhone sales (iPhone sales continued to exhibit the typical seasonal drop during the subsequent quarter). 

Nevertheless, the new color should lead to a slight increase in shipments -- one worthwhile enough for Apple to bring the new color to market.

Where's the red iPhone X?

As you might recall, Apple isn't just selling two flagship iPhones this year, it's selling three: iPhone 8, iPhone 8 Plus, and iPhone X. Apple's press release only mentions the iPhone 8 and iPhone 8 Plus in red, strongly suggesting that Apple has no plans to introduce an iPhone X in red (if Apple were planning to release a red one, now would be the time to do it).

This is probably going to prove to be a disappointment to some Apple fans as well as investors, particularly as iPhone X sales have fallen significantly short of expectations and anything that could give the product line a sales boost would be most welcome.

The reality is that it's probably quite difficult to build a red iPhone X. Keep in mind that Apple originally planned to introduce a gold version of the iPhone X but ultimately scrapped those plans reportedly due to issues in trying to match the color of the stainless-steel band around the phone to the gold back of the device. 

I strongly suspect, as analyst Rene Ritchie with iMore does, that the same issues that Apple ran into in trying to make a gold iPhone X would also apply to making a red iPhone X.

Moreover, while Apple is reportedly planning to roll out gold versions of its iPhone X successors later this year, it's unlikely to offer red versions. This means that there's a real financial benefit to Apple investing in trying to make gold stainless steel finishes possible, while the financial return for working on a red color, especially for a limited-edition midcycle refresh, wouldn't be worth it.

Along those lines, there were some rumors that Apple planned to introduce a midcycle gold version of the iPhone X to try to boost sales, but I'm increasingly skeptical of that now, as I'd have expected Apple to announce such a device alongside the red versions of the iPhone 8 and iPhone 8 Plus.

Ashraf Eassa has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.

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