It’s been a week since Apple’s (AAPL) iPhone 16 lineup went on sale, and Wall Street isn’t happy with the early results. This is because the shipping time for the company’s latest smartphones is shorter than usual. While this may be good for consumers, it could also indicate that demand for Apple’s latest smartphones is lower than for its predecessors.
The idea is that if customers can easily get a new iPhone, there will be a relative surplus of phones available for purchase compared to last year.
“Typically at this point in the launch cycle, demand is somewhat stable, so wait times for high-end products are sequentially longer,” UBS analyst David Vogt said in a note to investors on Tuesday. said.
“However, high-end 16 (Pro and Pro Max) latencies in the US did not increase as significantly as high-end 14 and 15 latencies.”
Morgan Stanley Research’s Eric Woodring expressed a similar view in a note to investors, saying that as of Tuesday, 11 days after iPhone pre-orders began, lead times for the iPhone 16 continue to be similar to those of previous iPhones. It says that it is below the sales cycle.
Based on Morgan Stanley checks, the average lead time for the iPhone 16 was 15.2 days, compared to 25.7 days for all iPhone 15 models last year and 18 days for the iPhone 14 series, Woodring said. Ta.
On Friday, September 20, 2024, iPhone 16 models will be on display at the Apple Store on Regent Street in central London as the iPhone 16, 16 Plus, 16 Pro and 16 Pro Max launch alongside other Apple Watch products. I am. (via James Manning/PA) (ASSOCIATED PRESS)
Importantly, Woodring noted that the iPhone 16 doesn’t appear to be affected by the kinds of supply constraints that have caused slowdowns in iPhone shipments in recent years, although Apple typically sells iPhone numbers before launch. He added that it was overbuilt.
All in all, the early outlook for Apple’s iPhone 16 sales looks worrying. However, there are two other things to consider. First, Apple may simply have been better prepared for iPhone demand this time around, meaning it could ship iPhones sooner than in previous years.
The second point is that iPhone customers may simply be holding off on purchasing the iPhone 16 or iPhone 16 Pro because Apple Intelligence is not yet available. Apple Intelligence, this year’s flagship feature for iPhone, is scheduled to be released later this fall, with additional features added throughout 2025.
The first features coming in October include an improved version of Siri, summarization of text messages and other notifications, and a Word option to paraphrase and summarize text documents.
The latest iPhones don’t have Apple Intelligence, but they’re still great smartphones. The updated camera and improved photo style options are great features. Also, improved battery life and the addition of an action button to the base iPhone 16 and iPhone 16 plus are welcome upgrades.
story continues
But with Apple’s promise that Apple Intelligence will fundamentally change what users can do with their iPhones, consumers may feel it’s not worth it to upgrade now and instead switch when Apple Intelligence launches in October. There is.
And while the first few weeks of iPhone sales can provide early insight into Apple’s latest smartphone demand, the holidays are usually the most important indicator of how consumers are responding to the device. It is also worth noting that it is a season. If sales slump during that period, Apple will be really worried.
Sign up for Yahoo Finance’s Week in Tech newsletter. (Yahoo Finance)
Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter @Daniel Howley.
Click here for the latest earnings report and analysis, earnings whispers and expectations, and company earnings news.
Read the latest finance and business news from Yahoo Finance.
