 "Apple's new AI software, Apple Intelligence is the crowing jewel of the new iPhone 16 series. However, this highly anticipated feature is not yet available at launch. Image Credit: Reuters")
Apple’s stock dropped nearly 3 per cent on Monday after reports indicated that demand for the new iPhone 16 Pro models was softer than expected. Analysts highlighted shorter shipping times for the iPhone 16 Pro as a sign of weaker pre-order demand, raising concerns about the tech giant’s latest product launch.
This decrease in demand is likely tied to the delayed rollout of key artificial intelligence (AI) features, which had been a major selling point for the iPhone 16 series.
Apple’s new AI software, Apple Intelligence is the crowing jewel of the new iPhone 16 series. However, this highly anticipated feature is not yet available at launch.
According to BofA Global Research, pre-order data showed that shipping times for the iPhone 16 Pro are significantly shorter than those for the iPhone 15 Pro at the same point last year.
Currently, the iPhone 16 Pro has an average shipping time of 14 days, compared to 24 days for the iPhone 15 Pro in 2023. Similarly, the iPhone 16 Pro Max has a 19-day shipping time, much lower than the 32-day wait for last year’s Pro Max model.
Taiwan-based analyst Ming-Chi Kuo from TF International Securities pointed out that the delayed availability of Apple Intelligence, particularly for the US version, may be deterring potential customers from upgrading.
Impact Shorts
More ShortsApple Intelligence, expected to be available in beta next month for US users and later for other regions, is a key feature of the iPhone 16 series. The delay in this rollout may have led to more cautious consumer behaviour. Kuo reported that pre-order sales for the iPhone 16 Pro and Pro Max were down 27% and 16%, respectively, compared to last year’s models.
While demand appears to be lower in the US market, some analysts suggested that improving supply of the Pro models could also be contributing to the shorter shipping times.
Last year, supply chain issues, particularly with a camera lens for the iPhone 15 Pro Max, had caused delays. However, Jefferies analysts noted that even with a possible increase in supply, demand for the iPhone 16 Pro seems to be weaker than in previous years.
Despite the concerns, some market watchers remain optimistic. D.A. Davidson analyst Gil Luria noted that the gradual rollout of AI features could lead to an extended upgrade cycle over the next 12 to 18 months. As Apple Intelligence becomes fully available, consumer interest in the iPhone 16 series may pick up, potentially balancing out the weaker-than-expected initial demand.
In the meantime, Apple will be closely monitoring consumer response as it navigates the delayed feature launch and attempts to reignite enthusiasm for its flagship product.