Over the course of fiscal 2018, Apple's (NASDAQ:AAPL) iPhone X proved to be a successful product. Not only was it the most popular iPhone during its run, but its relatively high price helped boost Apple's iPhone average selling prices over the course of fiscal year 2018.
It would seem, though, that its direct successor isn't anywhere near as successful. In fact, according to new data from CIRP, which shows the mix of iPhone shipments in the United States by model during the fourth quarter of 2018, the device looks like a total flop. Let's dig in to the data.
The iPhone XS's dismal performance
According to CIRP, the best-selling iPhone in the United States during the December quarter was the iPhone XR by a pretty significant margin, making up 39% of overall shipments. The iPhone XS Max was the second most popular iPhone model overall, while the vanilla iPhone XS was the slowest-selling of the trio of new iPhones that launched.
"iPhone XS and XS Max together accounted for 26% of iPhone sales, with the Max model outselling the standard-sized XS model by a more than two-to-one ratio," CIRP said in its press release.
Perhaps embarrassingly for the iPhone maker, even the prior-generation iPhone 8 and iPhone 8 Plus each outsold the new iPhone XS. On the bright side, the iPhone XS did apparently outsell each of the two-generation-old iPhone 7-series devices.
By contrast, each of the iPhone 8, iPhone 8 Plus, and iPhone X sold better than any previous generation model in the United States during the December 2017 quarter.
What does this mean?
I believe Apple will take this data into account as it crafts future iPhone products. The fact that customers clearly prefer the iPhone XS Max to the iPhone XS seems to indicate that customers who spend big bucks on smartphones -- at least those in the United States -- also tend to value larger-screen devices.
The iPhone XR outselling the iPhone XS isn't as useful of a data point because the iPhone XR not only has a larger screen than the iPhone XS, but it's also significantly cheaper (iPhone XR starts at $749, while the iPhone XS begins at $999).
While the rumor mill points to Apple continuing to use the same basic form factors for its 2019 iPhone lineup as it did with the 2018 models, I'd imagine that with the 2020 iPhone lineup, the company will rethink the screen sizes it offers. I'd imagine that iPhone screen sizes are, on average, set to get larger.
Keep in mind that this data is only for the United States -- the sales mix could potentially be different in other regions. Nevertheless, given how important the United States is to Apple's business (the Americas, in aggregate, made up 42% of Apple's fiscal 2018 revenue), and given that users in the Greater China region (which makes up 20% of Apple's fiscal 2018 revenues and a is geography in which Apple seems to need to take action to boost revenues) are also known to prefer larger screen sizes, I'd bet money that the 2020 iPhones won't come in the same screen size offerings that the 2018 did and the 2019 models likely will.
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.