Even though the iPhone 8 reveal is believed to be right around the corner—Sept. 12, if the latest rumor is correct—demand for Apple’s current iPhone models remains strong, according to analysts. It seems that mobile carriers are supporting this surprisingly strong iPhone demand. The September quarter is typically slow for iPhone sales until the new models are made available for purchase, usually later in the quarter.
iPhone demand remains strong
Canaccord Genuity analyst Michael Walkley reported this week that his surveys indicate that iPhone demand is still resilient in North America right now. He cited carrier promotions and also a lack of competition and said that these two factors will likely drive better-than-expected unit numbers. He’s still projecting 46.5 million iPhone units for the September quarter. Like most analysts, he expects three phones to be released in September, and he believes the widely-anticipated tenth anniversary model will be positioned between the base model and the Plus model in terms of size.
Although iPhone demand remains strong now, he doesn’t expect this to delay demand for the iPhone 8, which he believes will have the “highest screen to body ratio ever” in any smartphone. He maintains his Buy rating and $180 price target on Apple stock.
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Not pausing to wait for the iPhone 8
KeyBanc analyst Andy Hargreaves said in a note to investors earlier this month that there were no signs that the bull thesis of pent-up iPhone demand was playing out, which indicates that this trend has been playing out for the last several months. He said that consumers weren’t pausing their iPhone purchases during the June quarter to wait for the iPhone 8, and Canaccord Genuity’s survey indicates that they still aren’t pausing to wait for it.
Hargreaves added in his post-earnings note that the lack of signs that pent-up demand for the iPhone 8 is building was causing him to question whether Apple’s next iPhone models will be able to “drive the outsized upgrade rates and growth in new users that consensus estimates anticipate.” He also recalled that Apple CEO Tim Cook said that upgrade rates during the June quarter were in line with the four-year average.
This is particularly interesting because Cook said on the earnings call for the March quarter that rumors about the next iPhone models were causing consumers to pause their purchases. However, more recent evidence clearly indicates that he was wrong.
iPhone 8 reveal said to be set for Sept. 12
We’ve been hearing rumors about the iPhone 8 for a long time, and they’re picking up even more steam as the expected unveiling approaches. Mac4Ever claims that Apple has set the iPhone 8, iPhone 7s and iPhone 7s Plus event for Sept. 12, citing sources at mobile carriers. The French-language website said carriers have been told when the event is because they have to get the inventory ready and prepare marketing for the new iPhone models.
In all likelihood, Mac4Ever is probably correct, based on past iPhone event dates, but of course Apple hasn’t sent out press invitations yet and probably won’t until next week. Additionally, there are still other sources floating other dates, so it’s best to take this with a grain of salt.
Further, we’ve heard numerous times that Apple might delay the iPhone 8 for various reasons, one of which is lagging supply of OLED panels. In fact, DigiTimes reported earlier this week that the tenth anniversary iPhone model may not enter volume production until November. The website also said that the first “wave of shipments” could be as few as 5 million units, citing anonymous market watchers in the global handset supply chain.
DigiTimes wrote, “If such a scenario is to happen, the sentiment of the new iPhone devices will be seriously impacted, said the sources.”
We heard toward the end of last month that the iPhone 8 would not be delayed and was already entering trial production, so this comment could be just plain wrong, or it could mean that Apple’s assemblers are having problems.