AAPL Apple Inc

By Sarah Needleman and Tripp Mickle 

Apple Inc. on Wednesday introduced a new keyboard for an upgraded MacBook Air, another sign that it is abandoning the problematic butterfly keyboard it introduced in 2015 that required extended repair programs.

The company also unveiled an updated iPad Pro with an ultrawide camera, high-quality microphones, motion sensors and a scanner. But it didn't announce a refresh or successor to its entry-level 13-inch MacBook Pro, which would be priced between the Air and the expensive 16-inch MacBook Pro. It also didn't mention any new iPhone models, though analysts expect a small iPhone to be revealed this spring.

Apple is releasing the products into an uncertain consumer market that has been disrupted by the spread of coronavirus. In a bid to curtail the virus' spread, many companies have asked staff to work remotely, but others across the retail, entertainment and hospitality sectors have temporarily closed.

On Tuesday, Apple said it would keep its world-wide stores closed until further notice, an update from its previous plans to reopen as soon as March 27. Apple, which has more than 450 stores outside Greater China, depends on Western Europe and the U.S. for about two-thirds of its $206 billion in total sales.

Sales of Macs and iPads account for about a fifth of Apple's annual revenue. As those businesses struggled to deliver growth, Apple has moved to increase prices on new products. The iPad Pro, first introduced in late 2018, helped lift tablet sales 17% in the fiscal year ended last September behind its sleek new design and 25% price increase. The refreshed MacBook Air, introduced at the same time, cost 20% more than its predecessor and helped lift Mac sales 2% last fiscal year. But at $999, the device is also back at a lower entry price that is $100 cheaper from the prior model.

Apple's decision to release a new MacBook that returns to the traditional scissor-keyboard mechanism promises to move it past a controversy that dogged it for five years. In 2015, Apple began putting a "butterfly" keyboard that helped make its laptops thinner but created reliability problems such as missed key presses or duplicate keys. Multiple lawsuits were filed over the defects, and Apple extended repair programs.

The company first returned to the scissor keyboard, an industry standard, with a MacBook Pro 16-inch laptop introduced in November.

The new iPad's wider array of features suggests that the device is now a full-fledged competitor to the MacBook line, while its new scanner may be a sign of more advanced augmented-reality capabilities to come to new iPhone models this fall and ultimately AR glasses. It measures the distance to surrounding objects up to five meters away, and works indoors and outdoors, Apple said.

Sales of the refreshed MacBook Air and iPad Pro will start on its website Wednesday, the company said.

Apple also introduced a floating-design keyboard dock for the iPad Pro, with backlit keyboard and a trackpad. Apple says the keyboard will be available in May at a starting price of $299.

The product releases, though, didn't help improve the company's outlook for Wedbush Securities analyst Dan Ives, who lowered his price target for Apple Wednesday to $335 from $400. He expects iPhone revenues to fall by 14% for the current fiscal year and 10% for fiscal 2021 due to changes in near-term consumer demand, lockdown conditions globally and a negative economic backdrop.

"Right now the average global consumer is focused on staying healthy, finding food and sanitizer, not buying a new iPad," Mr. Ives said.

Write to Sarah Needleman at Sarah.Needleman@wsj.com and Tripp Mickle at Tripp.Mickle@wsj.com

(END) Dow Jones Newswires

March 18, 2020 09:56 ET (13:56 GMT)

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