iPhone Home screenSource: iMore

What you need to know

  • Wedbush has cut its predictions for iPhone revenue this year and next.
  • Dan Ives has lowered revenue estimates by 14% for 2020.
  • He believes that the COVID-19 pandemic will stop "switchers" and "new-buyers" from moving to iPhone.

Analyst firm Wedbush Securities has cut its revenue estimates for iPhone in 2020 and 2021 due to the COVID-19 pandemic.

As reported by AppleInsider:

In a research note to investors seen by AppleInsider, Daniel Ives from Wedbush Securities is lowering iPhone revenue estimates by 14% in fiscal year 2020 and by 10% in fiscal year 2021 to reflect the change in near-term consumer demand, lockdown conditions globally, and a "negative economic backdrop." Practically, Ives believes that during the coronavirus pandemic, people looking to upgrade an iPhone still will do so, but "switchers" and new-buyers will wait, or not get an iPhone at all.

Ives reportedly believes that only "the installed based consumers currently in the window of an upgrade opportunity that have not upgraded their iPhones in more than 42 months" will buy a new phone for the foreseeable future. That's only around 325 million of Apple's 925 million iPhone customers

In 2020, he has revised revenue predictions down 14% to $131 billion from $152 billion. iPhone unit sales are estimated down at 172 million, compared to a prior forecast of 200 million.

Ives predicts a "modest gradual recovery" in 2021 but still believes iPhone revenue will be down by 10%. Apple has suffered tremendously as a result of the COVID-19 pandemic, its stock price falling to its lowest point since October last year. Currently, it is sitting at $237.37 in pre-market trading, a fall that would wipe off yesterday's recovery.