• Strong initial demand for Apple's entry-level iPhone 17 models is leading to extended wait times, particularly in the U.S. and China.
  • Weaker appetite for higher-priced Pro variants, combined with a strategic price cut for the Base model, is expected to cap average selling price (ASP) growth for the critical Q4 FY25 period.
  • Despite the ASP concerns, overall iPhone 17 shipments are projected to be robust, with some analysts predicting revenue growth that could exceed consensus estimates.

Early data on Apple Inc.'s iPhone 17 lineup reveals a divergent demand picture that could limit the tech giant's ability to boost the average selling price of its flagship product this quarter, according to an analysis by UBS.

Lead times for the new entry-level Base and Air models have stretched significantly compared to the iPhone 16 launch last year. In the United States, wait times are averaging around 18 days, up from 11 days for the previous model, according to people familiar with the supply chain data. The trend is even more pronounced in China, a crucial market, where customers now face an estimated 25-day wait, a sharp increase from the 9-day average seen with the iPhone 16.

This robust demand for more affordable options, however, is being offset by what appears to be more muted interest in the higher-end Pro models. This dynamic, coupled with Apple's own pricing strategy, is creating headwinds for ASP growth. While the company increased prices on the Air and Pro variants, it simultaneously lowered the implied price of the entry-level Base model. The net effect of this mix shift is likely to constrain the upside for Apple's overall pricing power in the current fiscal quarter.

"The strength at the low end is undeniable, but it comes at a cost to the product mix," said an analyst who was not authorized to speak publicly. "Without a stronger pull-through on the Pro models, it's difficult to see meaningful ASP expansion this cycle."

Apple did not immediately respond to a request for comment on the demand patterns.

The situation in China is particularly nuanced. Despite rising competition from local manufacturers and a regulatory delay that required specific design approval for the Air model, early pre-order data from platforms like JD.com indicate the iPhone 17 is outpacing its predecessor. This suggests Apple is successfully capturing value-conscious consumers, even if it sacrifices some margin in the process.

Gene Munster, a managing partner at Deepwater Asset Management, has projected an 8% year-over-year increase in iPhone revenue for the quarter, which would beat the consensus estimate of 7%. This outlook underscores that strong unit sales volumes may still drive financial performance, even with flatter ASP growth. The company's ability to execute on hardware appears to be offsetting lingering concerns among investors about its progress in artificial intelligence features compared to rivals.

For now, the focus remains on whether demand for the premium tiers will accelerate as supply constraints ease, or if the value-oriented trend will define the iPhone 17 cycle. The final pricing mix will be a key metric watched by investors when Apple reports its quarterly results.