Saudi Press

Saudi Arabia and the world
Thursday, Oct 02, 2025

Only one major analyst was not impressed by Apple's results and here's what has him worried

Only one major analyst was not impressed by Apple's results and here's what has him worried

Barclays’ Tim Long is worried that Apple’s average iPhone pricing is too low as more users go for the cheaper phones. In an effort to grow its subscriber base for its services business, Apple has been selling iPhones with lower prices. Apple released three new iPhones in September: the iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max. The iPhone 11 starts at $699, $50 cheaper than last year’s iPhone XR.
Apple’s historically strong pricing power might be slipping, according to Barclays.

In an effort to grow its subscriber base for its services business, Apple has been selling iPhones with lower prices. Those prices may be too low, and too many consumers may be gravitating toward the cheaper options, according to Barclays, which expects this trend to continue.

“IPhone revenues were in-line, but we believe ASPs [average selling prices] were weaker,” Barclays IT hardware analyst Tim Long said in a note to clients Thursday. The note was titled, “Services Strength Masks ASP Pressure.”

Shares of Apple rose more than 1% on Thursday, a day after the company reported better-than-expected fiscal fourth quarter earnings and revenue despite a drop in iPhone sales. The technology giant posted earnings of $3.03 per share on revenue of $64 billion. Wall Street was expecting earnings of $2.48 per share on revenue of $62.99 billion, according to Refinitiv. The results got a boost from strong demand for iPads and AirPods as well as growth in Apple’s services business.

IPhone revenues came in at $33.36 billion, slightly higher than the $32.42 billion estimate, but Long said the average selling price of Apple’s iPhones will drop 10% year over year in the fourth quarter. Barclays now estimates a 12% average selling price decline in 2019 and a 6.5% average selling price decline in 2020.

Apple released three new iPhones in September: the iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max. The iPhone 11 starts at $699, $50 cheaper than last year’s iPhone XR. The lower prices were supposed to attract and larger scope of customers to Apple’s services business.

Long was originally bullish on Apple’s lower pricing strategy. He said “the lower price points are helping Apple after a few challenging quarters.” But he said he didn’t realize average prices would come in this low as more consumers go for the cheaper phones.

“We have discussed the mix down in iPhones that has been occurring all year,” said Long. “ASP [was] worse than our model.”

Barclays has an equal weight rating on the stock and slightly raised Apple’s price target to $236 per share to $224 per share, which is lower than the $243.26 per share Apple closed at on Wednesday.

The company could also see rising costs if a U.S.-China trade deal falls apart, squeezing margins further, investors fear.

“We still see pressure on the iPhone business, and believe that supply chain data may start turning over the next month as compares get more challenging,” said Long.

Some analysts are bullish on the prospect of new 5G iPhones set to be released next year, but Long doesn’t think Apple will be able to charge enough without hurting demand.

The lower pricing trend “may present challenges for 5G, which we believe will carry at least $150 higher ASP,” he said.
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
Nvidia and Abu Dhabi’s TII Launch First AI-&-Robotics Lab in the Middle East
UK, Canada, and Australia Officially Recognise Palestine in Historic Shift
New Eye Drops Show Promise in Replacing Reading Glasses for Presbyopia
Dubai Property Boom Shows Strain as Flippers Get Buyer’s Remorse
Top AI Researchers Are Heading Back to China as U.S. Struggles to Keep Pace
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
UAE-US Stargate Project Poised to Make Abu Dhabi a Global AI Powerhouse
Trump and Starmer Clash Over UK Recognition of Palestinian State Amid State Visit
Saudi Arabia cracks down on music ‘lounges’ after conservative backlash
Saudi Arabia Signs ‘Strategic Mutual Defence’ Pact with Pakistan, Marking First Arab State to Gain Indirect Access to Nuclear Strike Capabilities in the Region
Sam Altman sells the 'Wedding Estate' in Hawaii for 49 million dollars
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
Kuwait opens bidding for construction of three cities to ease housing crunch.
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
Could AI Nursing Robots Help Healthcare Staffing Shortages?
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Big Oil Slashes Jobs and Investments Amid Prolonged Low Crude Prices
Social Media Access Curtailed in Turkey After CHP Calls for Rallies Following Police Blockade of Istanbul Headquarters
Did the Houthis disrupt the internet in the Middle East? Submarine cables cut in the Red Sea
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Tether Expands into Gold Sector with Profit-Driven Diversification
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
Israeli Airstrike in Yemen Kills Houthi Prime Minister
After the Shock of Defeat, Iranians Yearn for Change
YouTube Altered Content by Artificial Intelligence – Without Permission
Iran Faces Escalating Water Crisis as Protests Spread
More Than Half a Million Evacuated as Typhoon Kajiki Heads for Vietnam
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Cristiano Ronaldo Makes Surprise Stop at New Hong Kong Museum
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
×