Early sales data suggests "healthy demand" for Apple's iPhone 16 family overall but softer than last year's editions for the higher-end models, JPMorgan said. Apple stock dipped on Monday.
Delivery lead times expanded during the second week of orders for the new smartphones, JPMorgan analyst Samik Chatterjee said in a client note Monday.
"Lead times are tracking more in line to iPhone 15 series for base models, but lower for Pro models," Chatterjee said. "However, expansion of the lead times across the board is an indicator of healthy demand, albeit likely weaker than last year for the Pro models."
The next critical data point to watch is whether lead times moderate into the third week of orders, he said. The magnitude of change in shipment times will be "an indicator of momentum of demand for second-half 2024 prior to broader release of Apple Intelligence," he said.
Apple officially began selling its iPhone 16 handsets on Friday after a week of preorders. However, Apple's heavily promoted artificial intelligence applications, branded Apple Intelligence, won't be available until a software update in October.
Chatterjee rates Apple stock as overweight with a price target of 265.
IPhone 16 Sales 'Off To Strong Start'
On the stock market today, Apple stock fell 0.8% to close at 226.47.
Elsewhere on Wall Street, Wedbush Securities analyst Daniel Ives said Apple's iPhone 16 is "off to a strong demand start."
"Based on all of our recent Asian supply chain checks, this iPhone 16 upgrade cycle will be over 90 million units on initial launch and be up roughly 8 million to 10 million units from iPhone 15 and so far demand is tracking well globally," Ives said in a client note Monday.
He rates Apple stock as outperform with a 12-month price target of 300.
Next month's launch of the initial features for Apple Intelligence should provide a boost to iPhone 16 sales, Ives said.
Apple Stock In Consolidation Pattern
Meanwhile, Barclays analyst Tim Long said he saw "muted demand for iPhone 16" in the first weekend of actual sales.
"While it is still early and things could change, early signs are not encouraging," Long said in a client note. He rates Apple stock as underweight with a price target of 186.
"Sell-through remains key as Apple typically makes its first order adjustment in early October based on sell-through data points," Long said.
Apple stock is in a 10-week consolidation pattern with a buy point of 237.23, according to IBD MarketSurge charts.
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