Some Wall Street analysts predict an end of iPhone sales growth, shrinking iPad sales, and a tough year ahead for Apple
Apple is going to have a tough year — Suddenly, things aren't looking great for Apple in the near term. — Let's briefly run down why:
Context & Ripple Effects
This January 2016 warning from Wall Street analysts reads differently with hindsight: the call that iPhone growth was ending and iPad sales shrinking was followed within months by Apple's first quarterly year-over-year revenue decline since 2003, down roughly 10% to $52B on weakening iPhone sales.
The bear case had a specific mechanism — Above Avalon's analysis of a slowing upgrade cycle argued iPhone growth wouldn't recover — and the same conditions kept resurfacing: a 2019 guidance downgrade tied to China and market saturation, and a 2023 holiday quarter guided flat instead of the ~5% growth Wall Street wanted.
First-order effects
- Apple enters 2016 facing stalled iPhone growth and shrinking iPad sales — the two products that carry its revenue — with analysts publicly cutting expectations before any results are reported.
Second-order effects
- With the upgrade-cycle thesis gaining traction, the debate shifts from whether Apple will miss to how large the decline will be, putting the company's April quarter report under pressure to disprove rather than merely meet estimates.
Third-order effects
- If the saturation diagnosis is right, this marks the start of a recurring cycle: the same underlying conditions analysts flagged here reappear in Apple's 2019 China-driven downgrade and its flat 2023 holiday-quarter guidance, making iPhone dependence the structural question for the business rather than a one-year blip.
The trend: Apple's growth repeatedly bumps against iPhone market saturation, with analyst warnings like these preceding a decade of episodic revenue stalls.