Analysts at the Deutsche Bank have warned that sales of the iPhone 8 might fall below the expectations of Apple and its investors.
Apple has faced declining revenues over the past several years, and the iPhone remains the company's best-selling brand. Given the major hype that comes with the launch of any new iPhone, many have predicted that the iPhone 8 would launch to exceptionally strong sales, but Deutsche Bank has expressed skepticism regarding where these sales would come from.
"We believe investors will be disappointed by iPhone growth in FY-18 and FY-19," analysts at Deutsche Bank wrote in their report, which was obtained by Business Insider.
In the report, Deutsche Bank offered several reasons as to why they believe the expected iPhone 8 "supercycle" would not occur.
Why The iPhone 8 Won't Sell As Well As Predicted
One of the biggest issues confronting Apple is that it faces increased competition from other smartphone makers. Apple's iPhone 8 will be a premium device, but even within that market, it faces some stiff competition. The Samsung Galaxy S8 remains one of the best smartphones that money can buy, and Samsung is also preparing to release the Note 8 ahead of the newest iPhone. Beyond Samsung, Apple will also have to contend with Google's Pixel 2 and Andy Rubin's upcoming Essential phone.
Beyond those major manufacturers, Apple — and other smartphone makers — are facing stiff competition from Chinese manufacturers who often sell their phones at much lower price points than Apple. For example, the OnePlus 5 is one of the fastest smartphones on the market but is cheaper than both the S8 and the rumored price of the iPhone 8.
Speaking of prices, the iPhone 8 is rumored to cost more than $1,000 which could definitely hurt demand. Apple does have a loyal fan base, but if the company isn't careful then it could price itself out of the market. This is one area where the smartphone industry's planned obsolescence could come back to bite it. Given that users are expected to upgrade their smartphones every couple of years, many of them may not be willing to shell out that kind of money.
In the end, these are just industry predictions and shouldn't be taken as gospel. Apple has surprised us in the past so the iPhone 8 could very well enter a "supercycle," but it is also possible that sales might not hit the highs that Apple needs.
