(Bloomberg) — Shares of Apple Inc. (AAPL) fell Monday after a closely watched analyst warned that demand for the company’s new iPhone 16 Pro model is lower than expected.
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Pre-order sales, which began Friday for the phone, have reached an estimated 37 million units, TF International Securities analyst Ming-Chi Kuo wrote in a report. That’s down nearly 13% from last year’s iPhone 15 launch and is the result of weaker-than-expected interest in the Pro model of the iPhone 16, Kuo said.
“One of the key factors for the lower-than-expected demand for the iPhone 16 Pro series is that its key selling point, Apple Intelligence, is not available at launch along with the release of iPhone 16,” Kuo said in the report.
After a weak start to the year, the company’s shares have risen over the past four months as investors bet that Apple’s AI features would boost sales of its latest line of iPhones. They fell about 3% to start trading Monday, trimming their year-to-date gains to about 12%, behind the 15% rise in the Nasdaq 100 Index.
Analysts were largely disappointed following the company’s launch event last week, as most of the hardware announcements were leaked in advance. Looking beyond the launch event, Morgan Stanley’s Erik Woodring noted last week that attention will be focused on “early iPhone 16 pre-order and lead time data that we’ll begin collecting this Friday.”
Weak demand for the iPhone 16 is not a good sign, “especially as we head into the holiday sales season,” said Matthew Maley, chief market strategist at Miller Tabak + Co. The risk of a “meaningful decline” in the stock has “increased in a material way.”
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