Investors: Apple Intelligence may boost iPhone 16 sales, but a potential price hike may hinder supercycle

The iPhone 16 series is just around the corner now with the highly-anticipated Apple "It's Glowtime" event scheduled for this coming Monday, September 9. Investors are now also getting ready for the new phones, but they look at the situation through the lens of Apple shares and a possible iPhone 16 supercycle.

Investment firm Piper Sandler now reportedly believes that Apple Intelligence, which is Apple's take on generative AI (and which was expected earlier to start an iPhone 16 supercycle) will drive good sales at first, but an expected price hike may impact demand.

In July this year, the investment firm raised its Apple target price to $225, specifically because of Apple Intelligence. Now, in September, although the company believes Apple Intelligence will be key, it won't be so immediately.

Many of Apple Intelligence features will launch later in the year, and they won't particularly come out alongside the iPhone 16 phones. Piper Sandler also wants to see Apple do more Apple Intelligence marketing and says that there's a "lack of a killer consumer AI app" to date.

The firm isn't expecting any "revolutionary hardware innovations", and that has it wondering also if the Cupertino company will keep its existing iPhone pricing. The analysts claim that it's possible for Apple to have to charge more because of the costs of Apple Intelligence.

And if that happens, the firm believes it will be problematic. Analysts believe that consumer discretionary spending "is cracking", so a potential price increase won't be the best idea.

However, Piper Sandler also believes that an Apple Watch SE and lower-priced AirPods would be valuable for Apple in the current economic climate.

The investor firm won't be changing its existing price target of $225 as it believes that the value of Apple Intelligence is already included in it.

At first, when I first heard about Apple Intelligence and what it can do during WWDC 2024, I was super excited. I am still hyped, but somehow feel like Apple is promising a lot and may underdeliver. And with the lack of any substantial hardware upgrades with the iPhone 16 range, I'm prone to agree with the analyst firm that we might not see a huge iPhone 16 supercycle as once expected.