Apple's Anxiety: iPhone Sales Stall, VisionPro May Be Discontinued, Can Foldables & AI Save Growth?

Apple's Anxiety: iPhone Sales Stall, VisionPro May Be Discontinued, Can Foldables & AI Save Growth?The fall season, usually a time for strong iPhone sales, has brought a change this year. Financial Association journalists visiting several Shenzhen electronics stores found that, unlike previous years, iPhone models that were in short supply are now available with discounts exceeding 1,000 yuan across multiple channels

Apple's Anxiety: iPhone Sales Stall, VisionPro May Be Discontinued, Can Foldables & AI Save Growth?

The fall season, usually a time for strong iPhone sales, has brought a change this year. Financial Association journalists visiting several Shenzhen electronics stores found that, unlike previous years, iPhone models that were in short supply are now available with discounts exceeding 1,000 yuan across multiple channels. This likely reflects a slowdown in iPhone sales.

iPhone 16 Sales Fall Short of Expectations, Cancellation Orders Reported

This year's iPhone 16 series seems to have missed its anticipated strong market cycle. Ivan Lam, senior analyst at Counterpoint, notes that in the first three weeks following its launch, the 16 Pro saw year-on-year growth compared to the 15 Pro, but the sales of the basic iPhone 16 models declined, resulting in a 2% overall year-on-year drop. He believes that the launch of new flagship products from Chinese manufacturers in the coming weeks will put further pressure on Apple.

Meanwhile, news of Apple canceling iPhone 16 orders is spreading. Ming-Chi Kuo, a prominent Apple analyst at TF International Securities, stated in a recent report that orders for the iPhone 16 series have been significantly reduced, totaling approximately 10 million units, with the majority being non-Pro models, for the fourth quarter of 2024 and the first half of 2025. This adjustment has led to a revised production volume for the iPhone 16 in the second quarter of 2024, reaching approximately 84 million units, while the estimated production for the fourth quarter is down to 80 million units, below the 84 million units produced in the same period last year.

Despite the 16 series failing to meet market expectations for a strong cycle, several of Apple's suppliers recently told Financial Association journalists that their current production is good. Companies like Lens Technology, Goertek, and DESAY Battery all confirmed that their operations are running smoothly, with production capacity utilization remaining relatively stable.

VisionPro May Be Discontinued, Industry Chain Says Impact Minimal

Beyond its mobile phone business, Apple's new endeavor VisionPro has also received bad news. Media reports suggest that due to insufficient content and an overly high price, demand for Apple's VisionPro headset has been weak. Apple has significantly cut production of the VisionPro headset and may completely discontinue production of this version of the device by the end of 2024.

As Apple's foray into the virtual reality arena, VisionPro has been met with high expectations from the market. However, since its official launch in February this year, VisionPro has been a "popular yet unsold" product due to its high price. In April, Ming-Chi Kuo wrote that Apple had lowered its shipment expectations for the VisionPro headset in 2024, from the initial estimate of 700,000 to 800,000 units to 400,000 to 450,000 units. Counterpoint Research estimates that Apple has sold approximately 370,000 headsets in the first three quarters of this year and predicts a maximum of an additional 50,000 units by year-end.

The news of VisionPro's discontinuation has not caused panic within the supply chain. A Lens Technology securities department representative said that the product makes a negligible contribution to the company's revenue, virtually insignificant. A supply chain insider bluntly stated that the product is not very profitable.

What Cards Does Apple Still Have to Play?

Innovation is the lifeblood of technology companies, and Apple, once a world-renowned pioneer of countless new technologies and functionalities, is now clearly struggling. Finding new sources of revenue growth has become a top priority for Apple.

Can AI Features Drive New Growth?

Analysts told Financial Association journalists that AI is one of the keys to Apple's future growth. Recently, Apple CEO Tim Cook made another trip to China. Several sources report that this collective visit by Apple executives to the Chinese market aims to continue coordinating with relevant departments on the approval process for Apple's subsequent AI software and products, as well as to seek partnerships with local AI content and data service providers in mainland China. Apple intends to reach an understanding with relevant departments and have them recommend vendors they approve.

Currently, Apple's AI feature AppleIntelligence is still subject to significant regional restrictions. According to official information, AppleIntelligence began testing its US English version in October. Chinese, French, Japanese, and Spanish versions are set to roll out next year, but specific timelines are yet to be announced.

Ivan believes that AppleIntelligence's full impact will likely take time to manifest, given the diversity of features and regions covered. Therefore, AppleIntelligence will drive iPhone revenue growth in a gradual, step-by-step manner, rather than a single super-cycle.

Can Foldable Devices Be a New Growth Point?

Recent news about Apple's foldable phones has been increasing. Apple has revealed several patents related to foldable displays this year. A recent patent titled "Electronic Device Having a Display and Touch Sensor Structure" has sparked market attention. The patent documents include images of this technology being applied to tri-fold and quad-fold phones, igniting speculation about Apple's plans to create quad-fold smartphones.

Fan Boyu, an analyst at TrendForce, told Financial Association journalists that based on current observations of supply chain trends, Apple's plans to release foldable devices seem increasingly clear, with the first foldable phone likely launching in the second half of 2026 or 2027. He believes that in the absence of significant innovation in traditional straight-screen smartphone hardware, Apple may have to introduce foldable phones to meet market demand. He adds that based on past experience, although Apple actively pursues patent layouts, its actual product designs tend to be more conservative, making a groundbreaking leap of innovation unlikely.

What Lies Ahead for Apple?

From the current situation, Apple faces numerous challenges. iPhone sales are declining, VisionPro sales are weak, and whether foldable phones and AI features can become new growth points remains to be seen. Will Apple be able to regain its former glory and return to the pinnacle of the technology industry? How will its future unfold? We await to see.