As Apple's yearly iPhone launch cycle is just around the proverbial corner, Wall Street analysts are girding their loins to tackle the ever-changing reports and rumors emanating from within the iconic smartphone manufacturer's labyrinthine assembly line.
Today, Morgan Stanley's Erik Woodring is out with a fresh note on Apple's upcoming iPhone 17 lineup, with the dedicated launch event expected to feature Apple Watch Series 11/Ultra 3/SE 3, and AirPods Pro 3 as well.
Woodring believes the iPhone 17 Air would constitute the event's highlight product, featuring an ultra-thin design with a single rear camera and Apple’s bespoke C1 modem.
The Morgan Stanley analyst expects a 5 percent ASP growth for Apple iPhones in 2026, which is likely to be achieved via a combination of the iPhone 17 Pro model launching with the higher 256 GB storage variant, and the iPhone Air model priced at a $100 premium to the erstwhile iPhone 16 Plus:
"Our model embeds elimination of the 128GB storage SKU for the iPhone 17 Pro and a $100 Y/Y increase to Air model."
Do note that last year's iPhone 16 Plus was priced at $899. This means that this year's iPhone 17 Air - which is replacing the Plus model in Apple's smartphone lineup - is likely to launch at $999, as per Morgan Stanley's assessment.
Of course, Morgan Stanley's pricing strategy expectations for the iPhones contrast sharply with the consensus view on Wall Street, which is currently modeling flat unit growth and a mere 1 percent growth in the ASP.
Interestingly, today's note from Morgan Stanley is quite similar to the tone and tenor of an earlier write-up by JP Morgan, which is currently modeling the elimination of the 128 GB storage variant for the iPhone Pro, replete with a $100 price increase, but pricing the iPhone 17 Air at either $899 or $949.
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