Apple CEO Tim Cook called his company's caller iPhone income surge "simply staggering" connected Thursday. What was down the iPhone 17 family's palmy debut? Analysts person a fewer theories.
The institution topped Wall Street's expectations successful the astir caller quarter, posting $143.76 cardinal successful full revenue for the play that included a 23% year-over-year bump successful income of its signature smartphone. "It was a fantastic 4th for iPhone with an all-time gross grounds of $85.3 billion," Cook said connected the call. "This is the strongest iPhone lineup we've ever had and, by far, the astir popular. Throughout the quarter, lawsuit enthusiasm for iPhone was simply extraordinary."
Apple's beardown results don't needfully mean that customers are done holding onto their older smartphones for years astatine a time, a inclination enabled by the tech's increasing durability. Nearly fractional of U.S. iPhone users present clasp onto their smartphones for 3 years oregon longer, according to a September report by CIRP, which tracks information connected iPhone buyers done lawsuit surveys. That fig was 24% conscionable 5 years ago, notes expert Josh Lowitz, a spouse and co-founder astatine Consumer Intelligence Research Partners.
Rather, the accrued iPhone gross astatine the extremity of 2025 apt stems from factors similar Apple's updated pricing strategies and backlogged request from the galore customers who last bought caller iPhones during the Covid-19 pandemic, Lowitz says.
"Sales were precise beardown during the pandemic due to the fact that radical weren't spending connected restaurants and travel, and determination was a batch of wealth floating around. Now, the pandemic telephone buyers person 4-plus-year-old phones," says Lowitz. Those radical were simply "due" for upgrades, which helped spur the accrued demand, helium says.
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Wedbush expert Dan Ives agrees: "The iPhone 17 has astir been a sleepy astonishment upgrade cycle," owed partially to the "pent-up demand" of an estimated 315 cardinal iPhone users worldwide who hadn't upgraded their smartphones successful much than 4 years, according to Wedbush's estimates.
As for Apple's pricing strategies, Lowitz notes that Apple streamlined its offerings by discontinuing models older than the iPhone 16 line. Shoppers often similar to bargain the middle-of-the-road prime erstwhile presented with respective options, and by limiting the options, Apple functionally turned the modular iPhone 17 into that mediate option, Lowitz says.
From there, the iPhone 17 Pro and Pro Max weren't prohibitively costly capable — compared to the modular iPhone 17, anyhow — to dissuade customers from splurging, says Lowitz. Apple's latest premium-priced Pro and Pro Max smartphones accounted for 52% of U.S. iPhone income during the astir caller quarter, according to CIRP's estimate.
Plus, the phones themselves person mostly been positively reviewed and good received among consumers arsenic high-quality pieces of technology, says Lowitz.
Continued maturation 'all comes down to AI,' says analyst
The phones' improved prime whitethorn beryllium a double-edged sword for Apple's aboriginal sales, Lowitz says. Particularly if caller iPhone features lone get "incrementally better" successful the coming years, customers are improbable to repetition the caller surge successful iPhone income anytime soon, helium suggests.
But if Apple tin make wholly caller oregon dramatically improved iPhone features — perchance including artificial quality bundle oregon a foldable iPhone that's reportedly successful improvement — past the institution tin repetition its occurrence successful the contiguous future, says Ives.
"For Apple, it's harder and harder to travel up with a hardware upgrade rhythm that's going to excite customers," Ives says. "It each comes down to AI, truthful customers person benignant of been successful this waiting game."
On the Thursday call, Cook touted a planned concern with Google connected upgraded AI features for Apple's Siri virtual assistant, which helium said volition beryllium introduced aboriginal this year. Apple besides announced the acquisition of Q.ai, an Israeli AI startup.
Ives' prediction: Apple's customers volition support spending, astatine slightest successful the abbreviated term. "I deliberation these are going to each play into an upgrade rhythm that I deliberation is going to proceed for Apple for the adjacent 12 to 18 months," helium says.
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