Apple has some famously loyal customers. Yet as broader economic forecasts get downgraded left and right, it might be a hard time to convince people to upgrade their iPhones.
With Apple widely expected to unveil the new iPhone 14 lineup at its upcoming event next Wednesday, a big question mark still surrounds how much, in this economy, the tech giant will charge for its latest-and-greatest smartphones.
Apple has some famously loyal customers. Yet as broader economic forecasts get downgraded left and right, it might be a hard time to convince people to upgrade their iPhones.
“Apple faces a real conundrum of pricing,” said Ben Wood, chief analyst at market research firm CCS Insight. On top of inflation and cost-of-living pressures wreaking havoc on consumers, he noted that Apple simultaneously faces rising costs associated with iPhone components and transportation.
“My expectation is that Apple will probably have to nudge prices up,” Wood told CNN Business. But given the strain consumers are facing, he thinks Apple will also do “everything they can to make that as minimal as possible.”
Beyond the broader signals of a worsening economy, Apple is also facing other headwinds as it prepares for the product launch next week. Supply chain hiccups stemming from China’s zero-Covid policy were partly linked to the company’s 11% year-over-year drop in quarterly profits reported last month. Apple CEO Tim Cook said on the earnings call, however, that there was “no obvious evidence of macroeconomic impact” to iPhone sales.
