JPMorgan: AppleIntelligence Not Yet Boosting iPhone 16 Pro Demand, but Expected to Drive Sales Growth in the Future

JPMorgan: AppleIntelligence Not Yet Boosting iPhone 16 Pro Demand, but Expected to Drive Sales Growth in the FutureWhile previously anticipated to drive sales of the iPhone 16 series, JPMorgan now believes that the AppleIntelligence feature has not yet had a significant impact on demand for the iPhone 16 Pro models. After analyzing user surveys and early sales data for the iPhone 16 series, the investment bank found that orders for the iPhone 16 Pro models were "lackluster

JPMorgan: AppleIntelligence Not Yet Boosting iPhone 16 Pro Demand, but Expected to Drive Sales Growth in the Future

While previously anticipated to drive sales of the iPhone 16 series, JPMorgan now believes that the AppleIntelligence feature has not yet had a significant impact on demand for the iPhone 16 Pro models. After analyzing user surveys and early sales data for the iPhone 16 series, the investment bank found that orders for the iPhone 16 Pro models were "lackluster." The main reason may be that the AppleIntelligence feature is not yet available, and consumers are waiting to experience these features before purchasing.

In fact, AppleIntelligence did not even make it into the top five reasons for users upgrading their iPhones, coming in sixth place. The top five factors included 5G connectivity and overall phone speed. Additionally, AppleIntelligence is currently only available in US English, which has also limited its impact on users.

However, JPMorgan analysts expect consumer interest in AppleIntelligence to grow as support for more countries and languages expands. The company's survey shows that 63% of respondents intended to buy a new iPhone in 2023, and that figure has now risen to 68%, with particularly high demand from consumers in the US and China.

More notably, the propensity of Android users to switch to iPhones has also increased significantly, rising from 50% in 2023 to 61% in 2024. Furthermore, these users tend to choose high-end models, which contrasts with the current trend among existing iPhone users.

Based on these factors, JPMorgan currently projects that Apple will sell 76 million iPhones during the fourth quarter of 2024, with sales reaching 148 million units over the next four quarters. Nevertheless, the investment bank has rated AppleWatchSeries10 as "lackluster," with its survey showing that consumers are much more interested in AppleWatchSeries9 than AppleWatchSeries10.

In summary, JPMorgan believes that AppleIntelligence will drive sales of the iPhone 16 series, but the time is not yet right. While early demand for the iPhone 16 Pro models has been below expectations, the feature will gradually attract consumers as language and region support expands. Additionally, the trend of Android users switching to iPhones cannot be ignored, which will further drive iPhone sales growth. Based on current sales figures and projections for the development of AppleIntelligence, JPMorgan maintains its price target for Apple stock at $265.