iPhone X Predicted to 'Absorb' Up to $30B in Holiday Spending at Expense of Other Retailers
High demand for the iPhone X will drive an upgrade "supercycle" this holiday season that could see shoppers spending the bulk of their holiday cash at Apple Stores, according to a note from Morgan Stanley analyst Katy Huberty (via Business Insider).
Given the high price of the iPhone X, which starts at $999, the iPhone X could "absorb" $30 billion of discretionary spending during the holidays, impacting other retailers. Huberty believes customers will be drawn to all of the new features in the iPhone X, and will reduce spending in other categories in order to afford the device.
"Apparel is a wallet share donor to other categories, with cell phones/technology and services being two of them. We see this upgrade supercycle coupled with the very high $999 iPhone X average selling price as a significant headwind to Specialty Retailers and Department stores in the fourth quarter."
After spending upwards of a thousand dollars on a phone, Huberty believes customers will be left thinking things like "'I just bought a $1,000 phone last month, I don't really need another pair of jeans.'"
Combined, Huberty believes iPhone X, iPhone 8, and iPhone 8 Plus could take approximately $52.6 billion of spending away from other categories this holiday season. Given the limited supply of the iPhone X, other retailers could be impacted by sales of the device well into 2018 as Apple works to reach supply/demand balance.
Apple has not provided insight into iPhone X sales thus far, but the company has said demand for the new device, which sold out in just a few minutes after pre-orders went live, is "off the charts."
Popular Stories
Following nearly two years of rumors about a fourth-generation iPhone SE, The Information today reported that Apple suppliers are finally planning to begin ramping up mass production of the device in October of this year. If accurate, that timeframe would mean that the next iPhone SE would not be announced alongside the iPhone 16 series in September, as expected. Instead, the report...
Key details about the overall specifications of the iPhone 17 lineup have been shared by the leaker known as "Ice Universe," clarifying several important aspects of next year's devices. Reports in recent months have converged in agreement that Apple will discontinue the "Plus" iPhone model in 2025 while introducing an all-new iPhone 17 "Slim" model as an even more high-end option sitting...
Apple supply chain analyst Ming-Chi Kuo today shared alleged specifications for a new ultra-thin iPhone 17 model rumored to launch next year. Kuo expects the device to be equipped with a 6.6-inch display with a current-size Dynamic Island, a standard A19 chip rather than an A19 Pro chip, a single rear camera, and an Apple-designed 5G chip. He also expects the device to have a...
Apple typically releases its new iPhone series around mid-September, which means we are about two months out from the launch of the iPhone 16. Like the iPhone 15 series, this year's lineup is expected to stick with four models – iPhone 16, iPhone 16 Plus, iPhone 16 Pro, and iPhone 16 Pro Max – although there are plenty of design differences and new features to take into account. To bring ...
Apple’s iCloud Private Relay service is down for some users, according to Apple’s System Status page. Apple says that the iCloud Private Relay service may be slow or unavailable. The outage started at 2:34 p.m. Eastern Time, but it does not appear to be affecting all iCloud users. Some impacted users are unable to browse the web without turning iCloud Private Relay off, while others are...
