Apple had high hopes for the iPhone 16, expecting its new artificial intelligence (AI) features to attract customers and boost sales.
However, early pre-sale estimates indicate a more subdued response than the company anticipated.
After experiencing a slowdown in iPhone sales in recent years, Apple needed the iPhone 16 to perform well.
In the past, dedicated Apple fans eagerly traded in their devices every year, but that enthusiasm has waned.
The company last gave consumers a strong reason to upgrade with the introduction of 5G connectivity in the iPhone 12.
Apple aimed to entice buyers this time with several new AI features, but it’s uncertain if those features have convinced consumers.
According to Ming-Chi Kuo, an analyst with TF International Securities, Apple sold around 37 million units during the first weekend of iPhone 16 pre-sales, representing a decline of over 12% compared to last year.
The demand for the higher-priced iPhone 16 Pro models fell significantly compared to the iPhone 15 launch.
Analysts from Wedbush and CFRA Research reported slightly higher estimates of around 40 million pre-sales, but still noted a year-over-year decline.
Beyond the overall sales figures, analysts are concerned about which models consumers are choosing.
There seems to be a stronger interest in the lower-priced iPhone 16 and iPhone 16 Plus models compared to the Pro versions.
This shift could impact the average selling price and overall revenue for Apple.
During the first weekend of pre-sales, sales for the iPhone 16 Pro dropped by 27%, while the Pro Max saw a 16% decline compared to the previous year.
In contrast, sales for the standard iPhone 16 and Plus models showed a slight increase compared to the iPhone 15.
One possible reason for the sales shift is that the standard iPhone models received significant upgrades in their cameras and internal processors, making them very appealing.
Angelo Zino, a CFRA analyst, expressed concern that the base models might be “too good,” leading consumers to prefer them over the more expensive Pro models.
Kuo noted that delivery times for the iPhone 16 Pro models were shorter than last year, indicating a smoother supply chain.
However, the much-anticipated AI features, branded as “Apple Intelligence,” are not yet available on the devices. They are set to roll out in beta next month alongside iOS 18.1.
The early response suggests that the promise of integrated AI features alone may not be enough to rejuvenate Apple’s iPhone sales.
Many consumers might not fully understand the benefits of the new AI capabilities, making it a tougher sell for those who aren’t dedicated Apple fans.
While it’s still early for the iPhone 16, and sales may increase since the official launch on September 20, analysts point out that the sales figures might not tell the whole story.
Lead times, or the wait between ordering and delivery, are often considered indicators of demand.
Although lead times are shorter for the iPhone 16 compared to last year, this could actually signify that Apple has improved its supply chain.
Despite the initial slow response, some positive signals emerged. T-Mobile CEO Mike Sievert mentioned that the carrier had sold more iPhone 16s than it did during the same period last year with the iPhone 15.
Apple has not revealed specific sales figures and will report earnings next month, which will include seven days of pre-sales and 10 days of regular sales.
However, many analysts remain optimistic that the iPhone 16 will gain traction in the coming months, particularly as the holiday season approaches.
Dan Ives, a Wedbush analyst, emphasized the importance of the upcoming holiday quarter, suggesting that a “supercycle” for the iPhone 16 could begin soon.
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