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Apple shares fall as iPhone 16 delivery times signal soft demand

POSTED ON September 17, 2024 •   Technology      BY Abiodun Saheed Omodara
The iPhone 16 Pro is seen at an event at the Steve Jobs Theater on its campus in Cupertino, California, US, September 9, 2024. l Credit: Reuters

Shares of Apple fell nearly 3% on Monday after some analysts said delivery times for the new iPhone 16 Pro models indicated weaker-than-expected demand, possibly due to the delayed rollout of key artificial intelligence features.

Apple last week uqnveiled its long-awaitedaaaa iPhone 16 series designed around its AI software, Apple Intelligence.

Early pre-order data from BofA Global Research revealed shorter global shipping times for the iPhone 16 Pro models compared with last year's 15 Pro models, as of Monday, three days after Apple started taking pre-orders.

Ship time on average for the iPhone 16 Pro currently stood at 14 days, lower than 24 days for the iPhone 15 Pro last year, the data showed, while the 19-day ship time for the iPhone 16 Pro Max compares with 32 days last year.

"The key factor is the lower-than-expected demand for the iPhone 16 Pro series ... the major selling point, Apple Intelligence, is not available at launch," Ming-Chi Kuo, a Taiwan-based analyst at TF International Securities, said in a blog post.

Apple Intelligence is set to arrive in the US version of the English language in beta next month, and for other versions as late as next year, potentially keeping some customers on the fence about upgrading to the 16 series.

First-weekend pre-order sales for the iPhone 16 Pro and Pro Max models were down 27% and 16%, respectively, according to Kuo.

"The US is much weaker than last year, unless Apple massively increases supply allocation," Jefferies analysts said.

To be sure, some analysts also said that improving supply of the Pro models could have led to shorter shipping times this time around, after supply issues with a camera lens affected shipments for the iPhone 15 Pro Max last year.

"We are not concerned if pre-orders don't show meaningful growth," D.A. Davidson analyst Gil Luria said.

"The (AI) features will be rolling out gradually ... which means the upgrade cycle will likely materialise over the next 12-18 months," Luria said.

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