BofA says iPhone need is still robust despite news of production cutback
Key takeaways:
- Bank of America says the market for the iPhone is still robust despite news that Apple cut back production of several models.
- Bank of America analysts said that after the $429 5G iPhone release in early March, Apple reduced trade-in values for most iPhone devices.
- 25% of international survey respondents still owned an iPhone 8 or earlier, according to critics. Old iPhone owners are the target audience for the iPhone SE.
On Wednesday, Bank of America critics said that the iPhone market is still robust despite current news saying that Apple cut its iPhone 13 and new iPhone SE production.
“While these reports might lead some investors to think there is a chance to demand, we think the demand for iPhones stays strong based on our research of iPhone trade-in prices,” the Bank of America analysts said.
Bank of America said Apple reduced trade-in values for several iPhone models after the $429 iPhone SE was released in early March. The note said that an iPhone 12 Pro Max, the latest model available for trade-in, is now valued at $650 instead of $700 before the launch.
The analysts claim that demand is still strong since Apple doesn’t ought to pay as much to persuade people to trade in older iPhones for the latest models.
An Apple representative wasn’t instantly available to remark on the trade-in price changes.
“This corresponds to the year 2019 when Apple showed high trade-in costs vs. 3rd parties to drive upgrades,” the analysts said. “Individually, China has set another round of lockdowns in Shanghai; however, as we once pointed out, firms have learned to manufacture through COVID, and Apple/Foxconn can migrate production to other sites, and, as of now, we do not anticipate a material effect from these closedowns.”