Apple’s new AI-driven iPhone is anticipated to drive growth for the company, yet expectations might need to be adjusted. According to Barclays analyst Tim Long, who is known for his cautious view on Apple, initial data from China suggests a lukewarm start for the iPhone 16. The early pre-order figures indicate a slower uptake than previous models, influenced by factors such as weakening consumer spending, macroeconomic pressures, and increased competition in the market.
Long’s analysis highlights a decline in overall pre-orders and a drop in the popularity of pro models compared to previous years. Specifically, pre-orders for pro models have fallen by double digits year-over-year, while base and plus models have seen growth. This trend suggests that while some segments of the iPhone 16 are performing well, the higher-end models are facing challenges.
A key factor affecting early enthusiasm is the delayed introduction of Apple Intelligence in Chinese, which is not expected until 2025. This delay, coupled with ongoing economic difficulties and competitive pressures, may have contributed to the softer initial demand for the iPhone 16. Apple’s strategy to offer significant discounts on the iPhone 15 to boost sales further underscores the challenging market conditions.
Long also observed that delivery times for pro models are shorter this year, which he attributes to both better production yields and lower demand. The combination of these factors indicates that while supply chain issues might be improving, the reduced interest in pro models is affecting overall delivery schedules.
For investors, Long’s outlook remains cautious, recommending an Underweight position on Apple stock with a target price of $186, implying a potential 14% drop in value over the next year. Despite this, the broader analyst consensus is more optimistic, with a Moderate Buy rating and a higher average price target of $249.46, suggesting a potential 15% increase in share value.
