The highly anticipated debut of the Apple iPhone 16 is likely a few months away. Traditionally, iPhones are unveiled in mid-September, and new estimates from Bloomberg suggest that the new AI features could spark a robust smartphone upgrade cycle for the world's most valuable company.
A person familiar with internal Apple projections and talks with suppliers and partners indicates that the company is forecasting a 10% growth in iPhone shipments compared to their predecessors, following the shipment of 81 million iPhone 15s in the second half of 2023.
The people said Apple has become increasingly confident that the new iPhone 16's 'Apple Intelligence' feature will drive an upgrade cycle among existing users. They said the new model equipped with AI will go on sale later this year.
Several tech blogs, including Proactive Investors, reported that the iPhone 16 is rumored to have a new power-efficient display, better zoom lenses, an action button, and several new AI-powered features.
Following Apple's Worldwide Developers Conference in early June, Wedbush analyst Daniel Ives wrote in a note to clients that optimism "grows throughout the Asia supply chain that this iPhone 16 AI-driven upgrade could represent a golden upgrade cycle for Cupertino." This is based on the idea of a global pent-up demand for AI iPhones.
Ives reiterated his 'outperform' rating and $275 price target, with shares trading around $232 in the early afternoon cash trading session.
"We believe the Street is now starting to slowly recognize that with Apple Intelligence on the doorstep in essence Cupertino will be the gatekeepers of the consumer AI Revolution," Ives said.
Starting with the debut of the iPhone 16 in mid-September, there will likely be a surge in app developers releasing generative AI-driven apps for the Apple Store shortly after, which could help drive AI iPhone demand.
However.
Oh wait, because Siri can now plagiarize as good as ChatGPT everyone will want to buy an iPhone, got it. https://t.co/1eVQs7tqqo
— zerohedge (@zerohedge) July 10, 2024
Sigh.
So all the people losing their jobs will use their savings on Apple products - wow what a forecast - 4T coming soon
— O Hassan (@oshcapital) July 10, 2024
Beyond the AI bubble, Apple faces sluggish demand for its overpriced products, like the Apple Vision Pro. There has also been a slowdown in iPhone sales in China, the world's largest smartphone market.
With the US labor market weakening and a consumer downturn emerging, CEO Tim Cook must introduce more affordable iPhone options for cash-strapped consumers.
