Citi Analysts Revises Apple iPhone Sales Forecasts

In a recent financial assessment, Citi analyst Atif Malik has amended the firm’s previous estimates for Apple's (NASDAQ:AAPL) iPhone sales. The updated forecast now anticipates a reduction in the sales numbers for the iPhone 16 units during both the September and December quarters of 2024, cutting estimates by 2 million units each quarter. Consequently, the new projection sets the total units sold at 83 million for the current year.

Looking ahead, Citi has adjusted its forecast for the subsequent years with an optimistic view on the sales trajectory. For 2025, the estimated sales figures for iPhone units in the March and June quarters have been increased by 4 million and 7 million, respectively. Overall, despite these increases, the forecast for 2024 shows a dip in iPhone units to 224 million—a 3% year-over-year reduction. For 2025, units are expected to escalate to 246 million, marking a 9% increase compared to the previous year.

In addition to changes in sales forecasts, Citi highlighted key strategic developments from Apple that could influence future sales. Notably, the scheduled release of ‘Apple Intelligence' in the U.S. later in October and a significant update to Siri expected next year are anticipated to affect consumer interaction with iPhones. These upcoming features may be causing consumers to delay their upgrades to newer iPhone models, as they await to experience firsthand how these technologies might enhance daily phone interactions.

Moreover, shorter lead times for the iPhone 16 series have been attributed to improved supply chain management. This adjustment might also play a role in consumer purchase timing, further affecting sales figures in the short term.

Despite the adjustments in iPhone unit estimates, Citi maintains a positive outlook on Apple, substantiated by a consistent ‘Buy' rating and a target price of $255. Current market activities saw Apple shares trading at $226.41, reflecting a 2.83% decrease. Apple’s financial health remains robust with a market capitalisation of approximately $3.44 trillion and steady revenues. The company also boasts a reliable dividend rate of 1.0, underscoring its commitment to shareholder value amidst evolving market dynamics.

This reassessment by Citi not only emphasises the anticipated consumer behavior changes due to technological innovations but also reinforces confidence in Apple’s strategic direction and market dominance. As the company gears up for its next product cycle, these adjustments in forecasts and strategic insights provide a nuanced view of the potential market movements and consumer trends in the coming years.