iPhone Demand Remains High Despite Technology Market Slowdown, Say Analysts
iPhone demand this quarter has thus far remained "surprisingly resilient" despite the widespread supply chain issues and other factors affecting the tech industry, according to Wedbush analysts Daniel Ives and John Katsingris.
Summing up their research findings in a new investor note, the market analysts said Apple's flagship devices had been holding up well despite "compression across the board in tech" and fears of a growth slowdown rising, as reflected in Apple's reduced share price.
The albatross for the June quarter in our investor conversations over the past month have naturally been the Covid lockdowns in China which will negatively impact revenue by between $4 billion and $8 billion as a headwind according to Cook & Co.'s guidance given last month.
As of now we believe iPhone demand is holding up better than expected (despite the various supply issues that have plagued Apple and the rest of the tech sector) and are trending better than management's guidance thus far in the quarter.
Apple last month said that lockdown disruptions in China and silicon shortages would continue to make it difficult to make enough product to satisfy strong consumer demand as the year progresses, and that this would ultimately affect Apple's June quarter revenue.
Wedbush said lockdowns and supply chain issues should be "peak worry" in the June quarter, but that then they would subside into the key September and December quarters on the heels of Apple's iPhone 14 launch.
We believe the initial bogey and production plans for iPhone 14 should be up modestly from iPhone 13 out of the gates which speaks to Apple's confidence that pent up demand for this next release remain healthy despite the jittery macro.
Wedbush analysts claim the stickiness of Apple's upgrade cycle is being underestimated by investors and Apple's installed user base will be key to iPhone 14 sales this year, with almost a quarter of the 1 billion iPhones in general circulation having not been upgraded for roughly 3.5 years.
On top of this advantage Apple holds over rivals, Wedbush expects Apple's services business to account for roughly $80 billion of annual revenue this year and is set to grow at a "steady double- digit clip" into 2023. "We believe Apple's services business is worth alone north of $1 trillion which coupled with the flagship hardware business makes the risk/reward very compelling at current levels," said the analysts.
Popular Stories
Apple is expected to unveil the iPhone 17 series on Tuesday, September 9, and last-minute rumors about the devices continue to surface.
The latest info comes from a leaker known as Majin Bu, who has shared alleged images of Apple's Clear Case for the iPhone 17 Pro and Pro Max, or at least replicas.
Image Credit: @MajinBuOfficial
The images show three alleged changes compared to Apple's iP...
An iPhone 17 announcement is a dead cert for September 2025 – Apple has already sent out invites for an "Awe dropping" event on Tuesday, September 9 at the Apple Park campus in Cupertino, California. The timing follows Apple's trend of introducing new iPhone models annually in the fall.
At the event, Apple is expected to unveil its new-generation iPhone 17, an all-new ultra-thin iPhone 17...
Apple will launch its new iPhone 17 series this month, and the iPhone 17 Pro models are expected to get a new design for the rear casing and the camera area. But more significant changes to the lineup are not expected until next year, when the iPhone 18 models arrive.
If you're thinking of trading in your iPhone for this year's latest, consider the following features rumored to be coming to...
Apple and Samsung have reportedly issued cease-and-desist notices to Xiaomi in India for an ad campaign that directly compares the rivals' devices to Xiaomi's products. The two companies have threatened the Chinese vendor with legal action, calling the ads "disparaging."
Ads have appeared in local print media and on social media that take pot shots at the competitors' premium offerings. One...
Apple is preparing to release iOS 18.7 for compatible iPhone models, according to evidence of the update in the MacRumors visitor logs.
We expect iOS 18.7 to be released in September, alongside iOS 26. The update will likely include fixes for security vulnerabilities, but little else.
iOS 18.7 will be one of the final updates ever released for the iPhone XS, iPhone XS Max, and iPhone XR,...
Another hint has surfaced that Apple is preparing to eliminate the physical SIM card tray from iPhones in more countries this year.
In particular, a source familiar with the matter has informed MacRumors that retail employees at Apple Authorized Resellers in the EU are required to complete a training course related to iPhones with eSIM support by Friday, September 5. There are 27 countries...
