Apple CEO Tim Cook on Thursday called the company’s recent surge in iPhone sales “simply amazing.” What was behind the successful debut of the iPhone 17 family? Analysts have several theories.
The company beat Wall Street expectations for its most recent quarter, with total revenue of $143.76 billion in the period and sales of its flagship smartphones up 23% year-over-year. “It was a great quarter for iPhone, with sales reaching an all-time record of $85.3 billion,” Cook said on a conference call. “This is our strongest and most popular iPhone lineup to date. Throughout this quarter, customer enthusiasm for iPhone was simply extraordinary.”
Apple’s strong performance doesn’t necessarily mean customers no longer need to keep old smartphones for years at a time, a trend made possible by the technology’s increased durability. Nearly half of iPhone users in the U.S. have now kept their smartphones for more than three years, according to a September report from CIRP, which tracks iPhone purchaser data through customer surveys. Just five years ago, this number was 24%, notes analyst Josh Lowitz, partner and co-founder of Consumer Intelligence Research Partners.
Rather, Lowitz said iPhone revenue growth at the end of 2025 is likely due to factors such as Apple’s updated pricing strategy and pent-up demand from many customers who last purchased new iPhones during the coronavirus pandemic.
“During the pandemic, sales were very strong because people weren’t spending money on restaurants or traveling and there was a lot of money moving around. Now, pandemic cell phone buyers have phones that are more than four years old,” Lowitz says. These people were simply “due” to upgrade, he said, which fueled the increase in demand.
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Wedbush analyst Dan Ives agrees. “The iPhone 17 was an almost sleepy surprise upgrade cycle,” in part due to “pent-up demand” with an estimated 315 million iPhone users worldwide who haven’t upgraded their smartphones in more than four years, Wedbush estimates.
Regarding Apple’s pricing strategy, Lowitz points out that Apple has streamlined its products by discontinuing models older than the iPhone 16 line. When presented with several options, shoppers often buy the option in between, and by limiting the options, Lowitz says, Apple functionally turned the standard iPhone 17 into an in-between option.
From there, the iPhone 17 Pro and Pro Max weren’t prohibitively expensive compared to the standard iPhone 17 to deter customers from splurging, Lowitz says. Apple’s latest premium-priced Pro and Pro Max smartphones accounted for 52% of U.S. iPhone sales in the most recent quarter, according to CIRP estimates.
Additionally, the phones themselves have received mostly positive reviews and are well-received by consumers as high-quality technology, Lowitz said.
Continued growth is “all about AI,” says analyst
Improving the quality of its phones could be a double-edged sword for Apple’s future sales, Lowitz said. He suggested that customers are unlikely to repeat the recent surge in iPhone sales anytime soon, especially if the iPhone’s new features only “incrementally improve” over the next few years.
But if Apple can create entirely new or dramatically improved iPhone features, which could include artificial intelligence software and a foldable iPhone reportedly in the works, Ives says the company could repeat that success in the near future.
“It’s becoming increasingly difficult for Apple to devise a hardware upgrade cycle that excites customers,” Ives said. “At the end of the day, it’s all about AI, so the customer is in a sense participating in this waiting game.”
On Thursday’s call, Cook touted his plans to partner with Google on upgrading the AI capabilities of Apple’s Siri virtual assistant, which he said is expected to arrive later this year. Apple also announced the acquisition of Israeli AI startup Q.ai.
Ives’ prediction: Apple customers will continue to spend, at least in the short term. “All of this will impact the upgrade cycle, which I think will continue for the next 12 to 18 months at Apple,” he says.
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