Wall Street comments on Apple's product launch: A large-scale upgrade will have to wait until iPhone 17, early supply chain feedback will determine the success or failure of this sales cycle

The iPhone 16 series has been unveiled, but the market response seems mediocre.

Although a new camera control button has been added, AI as this year's tech hotspot has sparked widespread discussion among Wall Street analysts due to its uncertainty in the iPhone 16 series.

While Apple plans to launch the Apple Intelligence Beta version in October, the specific consumer availability was not announced at the event.

JP Morgan believes that although the AI features of the iPhone 16 are limited, the iPhone 17 series in 2025 will introduce more AI features, which is expected to lead to a longer replacement cycle.

No surprises in the iPhone 16 series, waiting for the 17th?

Apple Intelligence is finally here... but not in the form the market expected.

During the new product launch event in the early hours of the 10th Beijing time, Apple finally announced the much-anticipated Apple Intelligence feature.

However, Craig Federighi, Apple's Senior Vice President of Software Engineering, mentioned during the introduction of Apple Intelligence that the feature will not only be rolled out in batches but also in stages to different countries and regions, with no specific consumer availability announced at the event.

Furthermore, even after the release on September 20th, the first users to purchase the iPhone 16 series products will not be able to experience Apple Intelligence immediately. The initial Apple Intelligence features will be launched in a test version in the U.S. market in October, limited to the English version. In December, the English version will be launched in the UK, Canada, Australia, New Zealand, and South Africa, with Chinese, French, Japanese, and Spanish versions to follow next year.

Goldman Sachs pointed out in its latest research report that the iPhone 16 series did not bring any surprises in terms of pricing, large-scale promotional activities, or AI features.

The iOS 18.1 system to be released next month will bring some basic AI features to the iPhone 16 series, such as text interaction with Siri, writing tools, smart replies, improved photo search and editing tools, etc. The Apple Intelligence feature will be available to users of iPhone 15 Pro, 15 Pro Max, or higher versions, as well as iPad and Mac devices with M1 chips or higher versions.

In the subsequent stages, more advanced AI features will be introduced, including personal context and Siri screen perception, Chat GPT perception, Genmoji, and Image Playground, among others.

In other words, the initial AI features are relatively basic, and to experience more powerful AI applications, one will have to wait until the end of this year or even next year.

The main factors affecting iPhone sales will be early order status and supply chain feedback

JP Morgan stated in its latest research report that the Glowtime event did not achieve the expected results and had limited positive impact on iPhone sales. The main factors affecting iPhone sales will be the early order status of the product and feedback from the supply chain. In the future, AI will still be a key factor driving strong cyclical growth in iPhone sales.

The camera control button and rich software features in the latest iPhone may enhance the attractiveness of the phone, stimulating consumer purchases.

Morgan Stanley also stated that in the short term, Apple Intelligence will not have much impact on the sales of iPhone 16. It will only play a bigger role when iPhone 17 is launched next year.

Due to the limitations of Apple Intelligence, it is expected that the production volume of the iPhone 16 series will remain stable in the second half of 2024 without significant growth.

It is expected that the iPhone 17 series will experience growth with the introduction of more AI features.

Morgan Stanley predicts that despite the addition of AI features in the iPhone 16 series, sales in the second half of 2024 will remain flat compared to the same period last year, at around 89 million units. With the upgrade of AI features, sales of the iPhone 17 series are expected to perform better, potentially triggering a new wave of Apple "upgrade cycle."

With more meaningful AI features after better hardware specification upgrades, the replacement cycle for the iPhone 17 series in the second half of 2025 will be longer