Apple showcases its foldable screen iPhone; analysts see potential but warn of profit margin risks

Apple has released its foldable iPhone, and analysts are generally optimistic about its market prospects, but profit margin pressure remains a major concern.

Wallstreet Insights mentioned that on Wednesday, September 9 (US Eastern Time), Apple released its first foldable iPhone, named "Duo," priced at $1,999.

Due to concerns over the cost and profitability of the high-end product line, Apple's share price closed down by a slight 0.28% on Wednesday following the announcement.

Several institutions pointed out that Apple's pricing strategy this time—the iPhone 17 and Air series maintaining previous prices, with Pro and Pro Max series price increases lower than expected—may exert pressure on overall profit margin. Jefferies believes this move indicates Apple is sacrificing profit margins to boost sales volume.

Bloomberg Intelligence gave the Duo’s product design a high rating, calling it "one of the best-designed Apple smartphones in years," and expects consumer response to be significantly better than recent models.

In terms of sales forecast, Bloomberg Intelligence has raised its first-year shipment expectation from the previous range of 10 million to 14 million units to around 14 million units. Based on the $1,999 price, first-year sales are expected to reach $28 billion.

Market research firm Vital Knowledge is also positive about the Duo’s capabilities, calling it "a very attractive" device with competitive pricing. However, it also cautioned that whether Apple can achieve sufficient production capacity to meet market demand remains to be seen.

At this launch event, Apple introduced the iPhone 18 Pro and Pro Max, as expected, without releasing a standard iPhone 18.

This means that the iPhone 17, which would typically either see an official $100 price drop or be replaced by the new model, will have to continue shouldering the sales responsibilities in Apple’s mid-tier market for another year.

As in previous years, Apple rarely announces price cuts for older models on stage, usually quietly updating the official online store after the launch by removing the old Pro series and reducing the price of the previous-generation standard model.

Analysts have expressed varying levels of concern over Apple’s overall pricing strategy this time. Jefferies maintains its "Underperform" rating and $263.66 price target on Apple, pointing out that keeping the iPhone 17 and Air series prices unchanged may help boost demand but could create more margin pressure.

Analysts specifically mentioned that "the iPhone 17 and Air series maintaining original prices" refers to Apple’s need to continue selling older models at the same price, despite significant increases in global supply chain costs (such as 2nm/3nm wafers and high memory prices), in order to stabilize its mid-market base.

Vital Knowledge also noted that the price increase for the Pro and Pro Max series was only $100, lower than the previously expected $100–200 range, suggesting that this might raise concerns about margins.

However, the firm also pointed out that Apple’s strategy seems to be aimed at shifting its product mix further toward high-end models, hoping that optimizing the sales mix will help offset some of the pressure.