• Jefferies (JEF) flags deteriorating demand for iPhone 18 Pro and Pro Max, citing shorter delivery times and falling resale prices.
  • In China, lead times have dropped to zero and component order cuts reach 10–15%, but the foldable iPhone Duo has 90+ day wait times.
  • The mixed signals complicate the outlook ahead of Apple (AAPL)'s November 2 earnings call, with analysts divided on the implications.

Jefferies Sounds Alarm on Pro Demand

Demand for Apple's iPhone 18 Pro and Pro Max is showing signs of weakening, according to a note from Jefferies analyst Edison Lee, who cited shorter delivery times, falling resale prices, and supply-chain checks pointing to component order cuts. In China, lead times for both Pro models have dropped to zero, compared with six days for the Pro and 25 days for the Pro Max last year. Japan also saw shorter wait times year over year, though U.S. Pro Max lead times were longer, indicating regional divergence.

The bearish signals extend to pricing. Chinese e-commerce platform PDD (PDD) began discounting the Pro by 6% and the Pro Max by 9% on October 16. All Pro variants reportedly moved to resale discounts from September 29, a stark contrast to last year's 1%–6% premiums. Jefferies' checks also suggest production cuts of 10%–15% for some components, including 2nm chips, though some supply-chain contacts estimate the net assembly reduction at only 2 million phones so far. A component-order percentage should not be equated with an equivalent reduction in total iPhone shipments.

Meanwhile, the foldable iPhone Duo, which opened preorders on October 16, is seeing delivery estimates exceeding 90 days. Jefferies estimates a maximum of 6 million–7 million shipments in calendar 2026, but a long backlog does not necessarily imply unexpectedly high annual volume. GF Securities (1776.HK) recently cut its 2026 Duo manufacturing plan from 7 million to 6 million units, citing hinge constraints—broadly consistent with Jefferies' ceiling, though build plans and shipments are different measures.

The China Conundrum

China's broader iPhone sales offer another layer of complexity. Jefferies says volumes rose more than 40% year over year during the first two weeks after shipments began, then slowed to about 8% in early October. Much of that strength was attributed to discounted iPhone 17 Pro inventory rather than the new generation. The zero lead times and falling resale prices in China contrast with longer U.S. Pro Max waits, cautioning against interpreting the headline as a uniform global slowdown.

Higher prices and component-cost pressure are also in play. Fortune's reporting links softer Pro demand to a $100 price increase and an AI-driven memory-chip shortage. This creates a difficult trade-off for Apple: passing higher costs to consumers risks reducing demand, while absorbing them can pressure margins. The broader smartphone environment remains challenging, with IDC projecting a 13.9% decline in 2026 shipments to 1.09 billion units amid memory shortages. Still, GF Securities analysts project Apple could be the only major smartphone manufacturer to grow shipments this year—a forecast, not a completed-year result.

Leadership Transition Adds a Wildcard

The launch represents an early commercial test under new CEO John Ternus, who succeeded Tim Cook on September 1. Cook became executive chairman. The cited demand reports describe supplier-order adjustments, not an announced company-wide restructuring.

Apple's latest quarterly results, for fiscal Q3 ended June 27, 2026, showed revenue of $109.4 billion, up 16% year over year, with diluted EPS of $2.02, up 29%, and gross margin of 50.1%. Those results included tariff refunds that added approximately two percentage points to gross margin and $0.11 to EPS, and predate the iPhone 18 launch, so they do not resolve the current demand debate. Apple's next earnings call is scheduled for November 2.

Analyst Divide and the Road Ahead

The warning has developed over several weeks. September commentary linked shorter Pro delivery windows to possible October production reductions, and Nikkei-related reporting in early October described supplier cuts. Jefferies' latest note adds discounting and resale-price evidence. However, there is meaningful analyst disagreement. On October 12, JPMorgan (JPM) reportedly argued that Pro demand was marginally stronger than for the iPhone 17 Pro at the comparable stage, dismissed the bearish interpretation of order cuts, and raised its Apple price target from $340 to $360. Jefferies' subsequent evidence is more negative, but the disagreement remains unresolved.

In the near term, Jefferies warns that additional order cuts are possible if weak demand persists. The next meaningful checks are whether Pro discounts deepen, whether delivery times remain short after the Duo's October 23 launch, and what Apple says at its November 2 earnings call. Longer term, two plausible paths remain: a favorable product-mix shift where the foldable establishes an additional premium category while Apple outperforms a shrinking smartphone market, or cannibalization plus cost pressure where Duo purchases replace Pro Max sales and manufacturing limits delay deliveries. Current reporting supports these as risks, not established outcomes.

The most useful distinction is between weaker demand for particular Pro models and weaker demand for Apple overall. Current evidence supports concern about the former; it does not yet conclusively establish the latter. Apple did not immediately respond to a request for comment.