Muted iPhone 16 Sales Signal Slow Start for Apple

Apple’s expectations for the iPhone 16 to revive its sluggish sales have faced early challenges, with pre-sale data showing a lukewarm consumer response. Estimates suggest Apple sold around 37 to 40 million units during the first week of pre-sales, a decline of over 12% compared to the iPhone 15. 

The higher-priced iPhone 16 Pro models, in particular, saw a significant drop, with sales of the Pro and Pro Max falling by 27% and 16%, respectively. In contrast, demand for the lower-priced iPhone 16 and 16 Plus rose slightly, potentially impacting Apple's average selling price and overall revenue.

Apple’s strategy to emphasize new artificial intelligence features as a major selling point seems to have fallen short of generating immediate enthusiasm. The company had hoped these AI advancements, set to roll out with iOS 18.1, would drive upgrades, but analysts suggest that consumers are yet to see enough value in these enhancements to justify the switch. 

Lead times for the iPhone 16 Pro are also notably shorter than last year’s iPhone 15, signaling either weaker demand or an improvement in Apple’s supply chain efficiency.

Despite this slow start, Apple remains optimistic as more devices have sold since hitting the shelves on September 20. Analysts anticipate a strong final quarter driven by the holiday season, with expectations of a potential sales supercycle. 

The true test will come when Apple reports its earnings next month, capturing the first few weeks of sales. However, some warn that unless Apple can better differentiate the Pro models from the standard iPhone 16, the company may continue to struggle with lower-than-expected demand for its higher-end devices.