Apple stock tumbles after analyst says iPhone 16 orders cut by 10 million units, sees 'no evidence' AI boosting demand

• Apple banal fell 3% aft a study said request for nan latest iPhone is waning.
• Analyst Ming-Chi Kuo said Apple trim iPhone 16 orders by 10 cardinal units.
• Apple's AI features are not yet driving contiguous iPhone upgrades, Kuo said.

Apple banal tumbled connected Wednesday, outpacing nan broader market's declines arsenic a salient proviso concatenation expert warned of waning request for its new iPhone 16 models.

Shares of Apple dropped astir 3% compared to nan Nasdaq 100's 2% diminution successful Wednesday day trades. The banal was trading astatine $229.50 astatine 2:50 p.m. ET.

The diminution successful Apple banal accelerated Wednesday greeting aft intimately followed Apple expert Ming-Chi Kuo of TF International Securities said that nan institution slashed its iPhone 16 orders by astir 10 cardinal units.

The reported accumulation cuts screen nan fourth-quarter of 2024 and nan first half of 2025, according to nan report.

Kuo said nan iPhone driblet successful orders suggests there's "no grounds yet that Apple Intelligence could boost iPhone shipments successful nan adjacent term."

Apple Intelligence refers to Apple's artificial intelligence tools, which see on-device AI capabilities that could besides beryllium outsourced to nan cloud.

While nan institution released its caller iPhone statement past month, its first information of package updates to bring Apple Intelligence to users of its devices isn't scheduled until later this month, and immoderate features won't beryllium updated until later this year.

In an question and reply pinch The Wall Street Journal, Apple's caput of software, Craig Federighi, said nan company's AI devices are a semipermanent story.

"This is simply a large lift, and we consciousness for illustration we want to get it right," Federighi said.

He added: "This isn't a one-and-done benignant of situation. This is simply a galore year, honestly moreover decades-long arc of this exertion playing out."

For now, consumers don't look to beryllium rushing to upgrade their iPhones for nan yet-to-be-released AI package features, which see summaries of matter and email notifications, enhanced photograph editing capabilities, and nan expertise to rewrite aliases make an email aliases matter connection response.

According to Kuo, nan accumulation trim for nan iPhone 16 apt won't beryllium afloat reflected successful Apple's fourth-quarter gross results, arsenic nan merchandise operation of much costly iPhone Pro models "is much favorable."

"However, iPhone revenues are expected to travel nether unit successful 1H25 owed to a YoY shipment diminution and a little favorable merchandise operation owed to nan motorboat of nan SE4," Kuo said.

The iPhone SE4 is Apple's lower-cost iPhone, which is expected to beryllium launched successful nan first 4th of adjacent year. The telephone is expected to costs astir $500 and person nan processing powerfulness required to tally Apple Intelligence features.

One fearfulness among Wall Street analysts is that nan cheaper iPhone SE could cannibalize immoderate of nan income of its iPhone 16 model, which costs person to $1,000 depending connected nan features.

While Kuo is bullish connected Apple's expertise to merge AI technologies into its iPhones, he said it will return clip and apt caller iterations of hardware to boost iPhone income considerably.

"Significant maturation successful iPhone shipments will apt require further hardware invention to travel this AI development," Kuo said.