Will iPhone usher in a wave of upgrades? At the Glowtime conference, Apple's AI may determine the "life and death" of the device

With just one week left before the Apple autumn product launch event, the countdown to the iPhone 16 debut has begun. "Apple Intelligence" is expected to be the Glowtime of this event.

In September, Apple will hold the "It's Glowtime" event, where the iPhone 16, a new Apple Watch, and possibly new AirPods will be released.

Analysts at Morgan Stanley stated in their latest research report that the focus of this event will be on the generative artificial intelligence (Apple Intelligence) integrated into the iPhone 16. To enable AI functions, the iPhone may increase its DRAM capacity, and the SoC performance will also see a significant upgrade. Additionally, pricing and battery life of the iPhone will be important details to watch.

Apple AI Takes Center Stage, Expected to Accelerate Upgrade Cycle

Analysts at Morgan Stanley mentioned that the introduction of Apple Intelligence in the iPhone 16 will help unleash pent-up demand and accelerate the iPhone upgrade cycle, which is currently at a historical high of 4.8 years. This move may also support Apple in adding iPhone production orders in the next 3 to 12 months.

The analyst continued:

We expect Apple Intelligence to take center stage at the iPhone 16 launch event, and "Glowtime" almost certainly refers to the new Siri user interface in iOS 18. While we still believe the rollout of Apple Intelligence features will be staggered this fall, the more Apple showcases Apple Intelligence features on the new iPhone 16 with 8GB of DRAM and a more powerful processor, the more likely consumers will associate Apple Intelligence with purchasing a new iPhone.

Financial firm Wedbush also has high expectations for this round of iPhone upgrade cycle, with analysts stating that this event will kick off the "largest upgrade cycle in Apple's history."

Morgan Stanley predicts that pre-orders for iPhone 16, 16 Plus, and 16 Pro/Pro Max will begin on September 13, with in-store sales/shipping starting on September 20.

Video screenshot: zollotech reveals the new colors of the iPhone 16 on social media.

iPhone 16 Starting at 256GB? Other Key Points to Watch Besides AI

Morgan Stanley stated in a research report that the pricing and battery life of the iPhone will also be important details to watch.

In terms of pricing, Morgan Stanley analysts predict that the pricing of iPhone 16 will remain unchanged from last year, but Apple may discontinue the 128GB iPhone 16 Pro model, thereby driving the average selling price (ASP) to grow by 5% in the 2025 fiscal year. The analysts wrote:

We assume that Apple has discontinued the 128GB iPhone 16 Pro SKU ($999), resulting in a starting price of $1,099 for the iPhone 16 Pro, while the starting price for the entry-level SKU of the iPhone 15 is $999. Based on our current bottom-up iPhone model forecasts, we expect the iPhone 16 to account for 68% of iPhone shipments in fiscal year 25, up from 66% in fiscal year 24. All these factors combined drive our forecast for a 5% year-on-year increase in the average selling price (ASP) of the iPhone in fiscal year 25.

Regarding the battery, Morgan Stanley stated that there are reports that Apple will equip the iPhone 16 Pro/Pro Max with new batteries that are about 10% larger, considering that large model language (LLM) on Apple devices may require more computational power, which is important.

For other updates to the iPhone 16 series devices, Morgan Stanley expects the iPhone 16 and 16 Plus to undergo limited "catch-up" upgrades, such as a new 3nm chipset (A18), 8GB of DRAM (higher than the 6GB in the iPhone 15/15 Plus), and an added action button.

For the iPhone 16 Pro and Pro Max, Morgan Stanley expects more significant component upgrades, including:

1. Thinner bezels;

2. Larger displays and slightly larger form factors;

3. Periscope-style telephoto lens for the iPhone 16 Pro;

4. Faster new chipset (A18 Pro), possibly equipped with more neural engine cores to enhance AI capabilities;

5. Larger capacity battery and metal casing to improve heat dissipation.

Morgan Stanley continues to view Apple as a preferred stock, believing that the product cycle of the new iPhone will have a positive impact on the company's performance. The firm stated that historically, on the day of an iPhone launch event, Apple's stock price usually performs slightly poorly, but it tends to outperform slightly in the following three months.