Why This Could Be a Big Year for the iPhone (and Apple Stock)

Core Insights - Apple is entering a potentially strong iPhone cycle, with early preorder data indicating robust demand for the iPhone 17 family compared to the previous year, despite uncertainty surrounding the new iPhone Air model [2][5][10] Group 1: iPhone Demand and Sales Performance - Preorder trends for the iPhone 17 models show stronger initial demand, particularly for the Pro Max variant, suggesting a solid baseline of demand from loyal customers [5][6] - In the fiscal third quarter, iPhone revenue reached $44.6 billion, a 13% year-over-year increase, accounting for approximately 47% of Apple's total sales of $94.0 billion [6][10] - The iPhone category's growth accelerated as Apple approached its fall launch window, with a notable increase from the previous quarter's revenue of $46.8 billion [6][10] Group 2: iPhone Air Model - The iPhone Air, at just 5.6 millimeters thick and weighing about 165 grams, is positioned to attract users seeking a lightweight device with a large display, filling a gap left by the discontinuation of the mini and Plus models [8][9] - Early reviews highlight the Air's premium build and ultra-thin profile as key selling points, although its demand relative to the core iPhone 17 models remains uncertain [8][9] Group 3: Market Valuation and Future Outlook - Apple's shares are currently trading at around 36 times earnings, reflecting a premium valuation that relies on steady product cycles and growth in the iPhone segment [7][10] - If the iPhone 17 lineup maintains its early momentum and the iPhone Air broadens the upgrade pool, revenue and earnings could continue to grow at healthy, double-digit rates, supporting the current valuation [10][11]