Wall Street firm says iPhone buyers willing to pay up for more "cool" features

U.S. securities house Cowen & Co. says that Apple iPhone buyers are willing to pay more for a larger sized screen, a dual-camera setup and other features. Compared to the Apple iPhone 7, the iPhone 7 Plus has a larger 5.5-inch screen, two cameras on back, additional RAM and a larger battery. At $769 and up, it also sports a larger base price than the $649 starting price of the iPhone 7.

Cowen estimates that the phablet-sized iPhone 7 Plus accounted for 40% of Apple's fiscal first quarter sales of 58.5 million iPhone 7/iPhone 7 Plus units. Last year during the same exact quarter, the Apple iPhone 6s Plus made up only 23% of total iPhone sales. According to Swiss banking giant UBS, the larger percentage of phablet sales should allow Apple to report a higher average sales price of $693 for the iPhone during the fiscal first quarter. 

Wall Street analysts expect overall iPhone sales to have risen 4% year-over-year to 78 million units for the three months that ended in December. This would be the first time that such sales for the holiday quarter following a new model launch (as opposed to an "S" series release), didn't increase at a double-digit pace. Sales of the Apple iPhone 6 increased 46% year-over-year during the 2014 holiday quarter, and 29% for the Apple iPhone 5 two years before that.

For Apple, it is important that Cowan is right about the strong demand for its more feature-rich phone. That is because the rumored premium Apple iPhone 8 model is expected to be released this coming September. That device could feature a 5.5-inch OLED display that covers the entire front of the phone. The Touch ID button will reportedly be embedded under the glass. 


Apple will be releasing its fiscal first quarter earnings report on Tuesday, following the close of the stock market.
 
source: WSJ