Demand for the iPhone 16 and 16 Plus appears to be falling short of expectations. Their demand is far below the iPhone 16 Pro series. Considering this, Apple is reportedly reducing production orders by up to 10 million units. The impact will be seen in the first half of next year. This adjustment, as noted by well-known Apple analyst Ming-Chi Kuo, suggests that the latest models do not spark a high level of interest. At least, it is far from Apple’s anticipation. The demand dip could stem from various factors. Some of them are market saturation, competition, or consumer preference for higher-end models. The interest on higher models has always been a ghost behind the non-Pro models.
Below you can see Kuo’s analysis in detail:
“I believe that Apple is best positioned to succeed in on-device AI, and I am confident about the long-term potential for Apple Intelligence to become a popular paid service. However, significant growth in iPhone shipments will likely require further hardware innovation to accompany this AI development.”
Production estimates for the iPhone 16 series continue to trend downward. The Q4 2024 is now expected to yield around 80 million units. This figure has been revised from an earlier estimate of 84 million. It was already a reduction from the 90–91 million units produced for the iPhone 15 series during the same period last year. Projections suggest iPhone 16 production will drop further. It will go down to 45 million units in Q1 2025. Then, it will reach 39 million units in Q2 2025. These adjustments underscore a notable decline in demand for the iPhone 16 series. It points to possible challenges in meeting consumer interest.
Ming-Chi Kuo remains skeptical about Apple Intelligence’s potential to drive demand for the iPhone 16 series, indicating that AI-related features might not be enough to boost interest in these models. Meanwhile, Kuo hints at a positive development on the budget front: production for the iPhone SE4 is expected to begin in December. Apple reportedly plans to manufacture around 8.6 million units of the SE4 by the end of Q1 2025, indicating a strong commitment to its budget lineup as it seeks to capture more price-sensitive customers.
