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Apple Inc.’s (AAPL) New MacBook Pro Already Needs a Price Cut

The new MacBook Pro seems likely to contribute to sales decline

Complaints from professional users are mounting after Apple Inc. (NASDAQ:AAPL) introduced its new MacBook Pro last week. Now, a noted Apple analyst is predicting the company will move to address some of the issues in a 2017 update, including a price cut to boost sales.

Apple Inc.'s (AAPL) New MacBook Pro Already Needs a Price Cut
Source: Apple

Apple unveiled the new MacBook Pro at an event last week, focusing on the new Touch Bar feature and a smaller form factor.

However, the reaction from the professional users who form the core base of MacBook Pro buyers was tepid at best. The list of complaints about the new laptops has only been growing since the event.

AAPL’s decision to eliminate all legacy ports and the MagSafe power port, replacing them with four USB-C ports, is proving contentious, as is the switch the new keyboard introduced with the MacBook last year. Capping maximum RAM at 16GB is frustrating many power users and adding insult to injury, the new laptops come at a hefty price increase compared to outgoing models.

New MacBook Pro Complaints Grow

One blog where professional and creative users have been venting is full of pronouncements like this one: “The people at Apple no longer have a clue what is desirable in a computer. At this, Apple is now incompetent. Tim Cook thinks everyone should just use an iPad.”

In other words, the reaction has not been what AAPL was hoping for.

Apple’s Mac sales had already been on the decline going into the event, as potential buyers held off in anticipation of the new computers. Judging by the online reaction, many of those AAPL customers are not happy and they may well forgo buying the new MacBook Pro.

Apple Insider reports KGI Securities analyst Ming-Chi Kuo is calling for sales of the old MacBook models to remain steady in Q1 2017. However, he is predicting slow demand for the new MacBook Pro to be a drag on sales, resulting in a 15% to 25% decline in overall shipments compared to Q1 2016.

What AAPL Might Do in 2017

While the first half of 2017 doesn’t look good for AAPL, things may get better. Time is on the company’s side in the sense that accessory makers are slowly boosting their USB-C offerings. With a growing selection of USB-C products — which offer considerably faster throughput than their predecessors — some of the controversy over axing all the new MacBook Pro’s legacy ports will likely die down.

The Touch Bar seems likely to be a factor as well. It’s being written off as a gimmick by some, but six months of having it available may result in the feature being put to good use by software developers.

KGI’s Kuo notes that AAPL has a historical pattern of pricing new laptops at a premium at launch, then lowering the price the following year. He’s predicting Apple will announce price drops for the new MacBook Pro during the second half of 2017. He’s also predicting a refreshed model that will go past the current 16GB ceiling, offering support for 32GB of RAM.

For the past decade, Apple could do no wrong so far as its core users were concerned and as a result its PC sales defied the industry slump. But its latest moves — the new MacBook Pro, axing the 11-inch MacBook Air, the single-port MacBook, dropping Apple-branded monitors — are causing many to rethink their loyalty. Many of these customers have also been waiting for the next generation iMac and Mac Pro to arrive.

Increasingly, it seems as though 2017 may turn into a watershed year for Apple and its computer business. What Apple does (or doesn’t) do with its desktop Mac line-up next year and how it handles the MacBook Pro blowup will either help to reverse the current Mac sales skid, or turn it into a full-fledged decline.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2016/11/apple-inc-s-aapl-new-macbook-pro-needs-price-cut/.

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