Increasing Trend: More Customers Opting for Foldable Phones, with Growing Popularity of Generative AI (GenAI) Features on Flagship Phones.
iPhone 15 series and iPhone 16 series shipments could decline significantly as the company faces various structural challenges, according to TF Securities International analyst Ming-Chi Kuo. The iPhone maker is contending with the rise of two new paradigms related to flagship smartphone design, while demand for its smartphones continues to decline in China, the analyst claims. Apple is expected to unveil its purported iPhone 16 lineup as the successors to its iPhone 15 series of smartphones in the second half of 2024.
Kuo states in a Medium post that his latest supply chain survey indicates the Cupertino firm has cut its shipments of key upstream semiconductor components to nearly 200 million units — a 15 percent drop compared to last year. The analyst claims that shipments of Apple’s iPhone 15 series will drop by 10 percent year on year (YoY) in H1 2024 while the iPhone 16 series will fall by up to 15 percent YoY in H2 2024.
According to Kuo, the reason behind Apple’s drop in shipments for the iPhone 15 and iPhone 16 is the various structural changes, including the growing popularity of foldable phones and the integration of generative AI (GenAI) features on high-end phones. The company is also said to be facing a decline in demand in China.
Amidst China’s ongoing crackdown on iPhones, Apple’s competitor Huawei is experiencing a resurgence in the country. Simultaneously, analyst Kuo notes a rising preference for foldable phones among users purchasing flagship devices. Recent weeks have seen a substantial 30 to 40 percent year-on-year decline in the weekly shipments of iPhones in China, as reported by Kuo.
However, Canalys data for Q4 2023 indicates that Huawei reclaimed its position in the top 4 smartphone brands in China, while Apple’s shipments in the country increased by 6 percent year-on-year, reaching 17.5 million units. In the same quarter, Apple secured the highest market share in China, according to Canalys. On the contrary, an IDC report revealed a 2 percent decline in iPhone shipments in China during Q4 2023.
Apple has adjusted its shipment forecast for the iPhone 15 in the first half of 2024, reducing it. In contrast, Samsung has increased its shipment forecast by 5 to 10 percent, attributed to the GenAI functions of the handset. Samsung introduced new ‘Galaxy AI’ features in the Galaxy S24 series, while Apple is expected to unveil AI features with its anticipated iOS 18 update later this year.