Jefferies flags soft demand for Apple iPhone 18 in China

by@zerohedge

Summary

Jefferies has raised concerns about soft demand for Apple's new iPhone 18 models, particularly in China, as indicated by weak resale prices, especially among premium versions. Edison Lee noted that resale prices for the iPhone 18 have declined compared to the previous generation, suggesting that consumers are resistant to recent price hikes of $400 to $500 and may be deterred by the switch to less desirable storage technology in higher-end models. While lead times for the new models showed a rebound over the weekend, Jefferies cautioned that this could be more related to supply constraints rather than an increase in demand. Additionally, the iPhone 18 DUO's reliance on eSIM technology, coupled with restrictions on the number of supported eSIM numbers in China, could hinder broader adoption beyond high-end early adopters, despite initial sales tracking broadly in line with the iPhone 17 launch.

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Analysis

Apple: Apple designs and markets consumer electronics with a focus on smartphones and related devices. The company is launching the iPhone 18 series, drawing analyst attention to demand patterns for its premium models in China. John Ternus, the incoming CEO, is navigating this rollout as an initial gauge of consumer response to the new lineup. Edison Lee: Edison Lee is Jefferies' head of China and Hong Kong technology and software research. He issued a note on the iPhone 18 launch that uses resale pricing data from Hong Kong to flag softer demand signals for higher-end variants. Lee's commentary emphasizes factors such as pricing and model-specific features in the Chinese market. John Ternus: John Ternus is the new chief executive officer of Apple. His early tenure includes oversight of the iPhone 18 introduction amid questions about premium model uptake. Analysts view the launch as an initial assessment of consumer willingness to accept higher prices for incremental changes. Market Context: Initial sales tracking for the iPhone 18 Pro shows results broadly comparable to the prior generation at a similar stage. Demand Indicators: Resale pricing trends in Hong Kong serve as a key signal of consumer response to the iPhone 18 premium models. Product Constraints: The slim iPhone 18 DUO relies on eSIM technology with China-specific limits on multiple numbers that may affect wider use beyond early adopters.

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