iPhone Revenue Expected to Decrease by Mid-Single Digits

The famous Apple analyst, Ming-Chi Kuo, warned that iPhone revenue might experience a mid-single-digit decline by 2026 if Apple doesn’t adapt its product and sales approach. Despite the introduction of Apple Intelligence, iPhone sales have not seen a significant increase, hinting at the possible drop in revenue. According to Ming-Chi Kuo, Apple’s share of global iPhone shipments in the fourth quarter of 2024 diminished by 2.3% compared to the same period in the previous year. Conversely, Japan, where Apple Intelligence is not yet available, observed a 6.8% hike in iPhone shipments during the same timeframe. Apple’s earnings report from January 30 highlighted a 5.8% decline in iPhone shipments year-over-year in the last quarter of 2024. Still, revenue only decreased by 0.8%, primarily attributing this outcome to the improved optimization of the iPhone product mix. Specifically, there was a shift towards the Pro series, with the shipment share rising from 54% to 61% during the same period. However, Ming-Chi Kuo cautions that the percentage of Pro models among total shipments cannot expand limitlessly.

The renowned analyst’s remarks indicate the need for Apple to reconsider its current strategies to combat the anticipated drop in iPhone revenue. The tech giant must adjust its sales and product tactics to counter the impending mid-single-digit decline in revenue as forecasted by Ming-Chi Kuo. Navigating through these challenges might require a strategic change in its marketing and sales approach to maintain its dominance in the smartphone industry.

In summary, Apple’s iPhone revenue might witness a mid-single-digit downturn by 2026 if it doesn’t reevaluate its product and sales tactics, stated Ming-Chi Kuo. Despite the implementation of Apple Intelligence, iPhone sales have not surged, leading to concerns over the projected revenue decrease. Ming-Chi Kuo underscored the importance of maintaining a balance in the iPhone product mix to maintain revenue growth, warning against an overreliance on the Pro series. The tech company needs to take proactive measures to mitigate the potential decline in iPhone revenue and secure its market standing amidst the stiff competition in the global smartphone industry.