Sales of new iPhones are 14% higher than past demand. What this means for investors

Sales of the new generation of Apple's iPhone have started in the U.S. and China better than it was with the previous model, according to Counterpoint Research analysts. Moreover, the base model iPhone 17 is rapidly gaining popularity. Although Apple has yet to launch AI services in China, consumers have appreciated the improved specifications and new design of the devices. The iPhone is Apple's main source of revenue, and investors will be watching demand for the devices in the key, holiday quarter.

The 17th-generation iPhone in the first 10 days of sales in the U.S. and China, respectively, outperformed the iPhone 16 lineup by 14%, Bloomberg writes, citing Counterpoint Research. The data, which for the first time quantifies consumer response in Apple's two largest markets, also shows that the $799 base iPhone 17 is in muchhigherdemand than last year's corresponding model. Analysts attribute the increase in sales to an improved display, more memory and the new A19 processor.

"In China, [iPhone 17] sales are nearly double the performance of the base model iPhone 16 during the same launch period, and the positive momentum has continued into October," Counterpoint said.

Strong demand is also seen at the other end of Apple's product lineup - the iPhone 17 Pro Max, especially in the US. According to Counterpoint, this is the model that is prompting users who bought the previous smartphone during the pandemic to upgrade. Apple's new flagship smartphone gets the best cameras in Apple's lineup, an improved cooling system and the most significant redesign of the body in years, Bloomberg explained.

Apple gets about half of its revenue from iPhone sales. The company managed to maintain high sales of the device despite a number of blunders in the development of artificial intelligence-based features and a delay in the launch of the Apple Intelligence service in China. In the final weeks before the launch of the iPhone 17 lineup in China, demand for Apple's smartphones fell 6 percent, more than usual during this period.

Investment bank Morgan Stanley speculated that strong demand for the new iPhone lineup could speak to Apple's growth potential in 2026. However, for that to happen, the company needs new products - such as a foldable iPhone - and full integration of AI services into the 18th-generation smartphones. In early October, the investment bank raised its target price on Apple shares to $298 from $240 and reiterated an "above market" rating (Overweight, consistent with a buy recommendation). Morgan Stanley's target is 18% higher than the current price.

JPMorgan Chase continues to consider Apple stock a good buy. This month, the largest U.S. investment bank reaffirmed its "Buy" rating on the iPhone maker's stock with a target price of $280. That's 11% higher than the current level.

According to MarketScreener, of the 48 experts who provide analytical support for Apple shares, only five recommend them for sale. Among the pessimists is the investment bank Jefferies, which in October downgraded Apple's securities from "Hold" (Hold) to "Below Market" (Underperform), and the target price - to $205. This is 19% down from the closing price on Friday, October 17.

This article was AI-translated and verified by a human editor