Apple is offering some customers replacement phones after discovering a problem with some batteries in the iPhone 5S, its newest and most expensive model. The malfunctioning batteries do not hold their charge properly:

“We recently discovered a manufacturing issue affecting a very limited number of iPhone 5S devices that could cause the battery to take longer to charge or result in reduced battery life,” said Teresa Brewer, an Apple spokeswoman. “We are reaching out to customers with affected phones and will provide them with a replacement phone.”

Apple did not say how many iPhones were defective, but its statement implied that it was a few thousand phones. In September, Apple said it had sold nine million new iPhones in the first weekend they went on sale.

The New York Times

Apple attributed the problems to defective manufacturing.

The company just announced revenues of $37.5 billion in the last quarter, a new record. Investors were nonplussed as profits declined:

While demand for the iPhone 5S was strong, supply backlogs meant that consumers couldn’t buy them as quickly as they wanted. And the newly-announced products — a lighter full-sized iPad, an iPad mini with a sharper display, and the most powerful desktop ever — won’t go on sale for weeks. Typically, profits improve as manufacturing costs decline with higher volumes, and the full suite of products will be available for the blockbuster holiday season.

The other problem, though, is that Wall Street’s expectations for Apple are incredibly high. The company missed expectations for iPad sales by 400,000 units, for example, despite the fact that sales were steady at 14.1 million in advance of the release of two new models, which usually depress sales of the old ones. And Apple often notes defensively that Wall Street wouldn’t expect quarterly miracles from any other company.

“All of these are products that only Apple could have delivered, and most companies would be happy with just one of them,” said Apple chief executive Tim Cook on the earnings call, after having run through the suite of updated gadgets.

Lydia DePillis

Apple encountered a similar problem when it released a new mobile operating system two years ago, iOS 5. Bugs in the software drained the battery in the newly released iPhone 4S, according to the company.


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