Winning Bizness Desk
Mumbai. Apple's stock took a significant hit on Monday, dropping more than 3 percent, leading to a total market value loss of $116 billion (approximately ₹9.72 lakh crore). The sharp decline comes on the heels of the iPhone 16 launch, amid concerns from analysts that the demand for the Pro models of the latest iPhone series may fall short of expectations. A major factor contributing to this forecast is the delayed introduction of some artificial intelligence (AI) features in the new devices. The news has left many Apple investors worried, as the stock has been steadily declining following critical commentary from market analysts.
What Caused the Drop?
TF Securities analyst Ming-Chi Kuo, known for his insights on Apple, noted in a blog post that while demand for the iPhone 16 and iPhone 16 Plus has seen a year-on-year increase, there are still concerns. Kuo reported that the company has received about 10 percent more pre-orders for the iPhone 16 compared to the same models from the previous series, and about 48 percent more for the iPhone 16 Plus. However, the overall sales of the iPhone 16 series during the first weekend of pre-orders are estimated to be around 3.7 million units, which is about 12.7 percent less than the iPhone 15 series launched last year. This drop in demand has raised red flags among investors, especially as Apple faces fierce competition in the high-end smartphone market.
Delay in AI Features
A major reason for the lower-than-expected pre-order numbers could be the absence of significant AI features in the iPhone 16 series at launch. At the Worldwide Developers Conference (WWDC), Apple showcased promising AI-powered features like Writing Tools and Image Playground, which are expected to be game-changers for users. However, many of these features will not be available until next year. The upcoming iOS 18.1 update, scheduled for release next month, will only include a limited number of these new features. Industry analysts suggest that the iPhone 16 series could see an uptick in demand during the upcoming holiday season, as more features are rolled out and consumer interest grows.
Impact on Stock and Previous iPhone Models
As Apple grapples with the tepid response to the iPhone 16 launch, it has also slashed prices of its previous iPhone models. The iPhone 15, introduced last year, and the iPhone 14, launched in 2022, have seen a price reduction of ₹10,000 on Apple's online store in India. Despite these efforts, Apple's stock took a hit on the Dow Jones on Monday, leading to significant financial losses. The company's $116 billion drop in market value underscores the challenges it faces as it navigates growing competition and evolving consumer expectations.
