14 DAY TRIAL // Apple will take the wraps off the new-generation iPhone in September, and just like it happens every single year, the upgraded models are expected to generate an upgrade supercycle.
In other words, the new iPhones are supposed to be so successful that they would finally convince those sticking with older models to upgrade, which would basically be a win-win for both customers and Apple.
Not only that buyers get the latest and greatest that Apple has to offer, but Cupertino also sells more iPhones. And Wedbush analysts Daniel Ives and Strecker Backe explain in a note to investors that this year the supercycle would be powered by 5G, the new technology that the 2020 iPhones would help become more mainstream.
China to remain a key cash cow
But more importantly, the new iPhones could help Apple reach $2 trillion valuation sometime next year, the analysts say.
“We believe during 2021 Apple will be the first $2 trillion valuation given the 5G tailwinds and services momentum potential over the coming years. In particular, we are seeing a continued demand snapback in China during the month of June and early July despite some speed bumps and the stage is setting up for a massive pent up iPhone 12 cycle heading into the Fall in this key region as well as globally,” the analysts said in the note according to AI.
Despite the difficult market conditions in China, the country is likely to remain an important cash cow for Apple, with the analysts estimating some 20 percent of all upgrades to come from this region.
“We believe in China alone between 60 million to 70 million iPhones are in the window of an upgrade opportunity over the next year with Apple going aggressively at all price points (SE, iPhone 12) to cement its installed base despite competitive pressures from domestic players,” they say.
Apple will launch four different iPhones this year with sizes between 5.4 inches and 6.7 inches.