Barclays Reports Weak Demand for iPhone 16

Barclays analysts noted on Monday that they perceive weak demand for Apple’s iPhone 16 based on shorter lead times and observations made during the first week of pre-orders.

According to their analysis, the early indicators are “not encouraging,” as both the Pro and standard models are experiencing a weaker reception compared to the iPhone 15 launch last year. The report emphasizes significantly reduced wait times in key regions, particularly for the iPhone 16 Pro models.

In the U.S., the lead time for the iPhone 16 Pro Max was just 26 days during the initial week, a decrease from 41 days for the iPhone 15 Pro Max. Similarly, the iPhone 16 Pro had an 18-day wait, down from 25 days the previous year.

In China, a critical market for Apple, the wait time for the iPhone 16 Pro Max has dropped to 18 days from 36 days for the iPhone 15 Pro Max. Barclays interprets these shorter lead times and diminishing demand as indicators of “weaker than expected demand, especially in the U.S. and China,” where consumer spending appears to have declined.

Furthermore, global pre-order units are estimated to be down by mid-teens percentage compared to the previous year, according to insights from the firm’s supply chain contacts. The launch of Apple Intelligence, a significant feature for the iPhone 16, has been delayed until 2025 in markets such as China and parts of Europe, which Barclays believes may dampen excitement for the new model.

The bank also noted that the earlier launch of the iPhone gives Apple two additional days of sales in the September quarter, but this is unlikely to counteract the negative demand trends.

In light of these challenges, Barclays has maintained its Underweight rating and a $186 price target on Apple, indicating that iPhone 16 demand may continue to fall short unless sales improve in the coming months.