Apple's Iphone Duo Once Again Challenges Ultra-High-Priced Hardware—Will Investors Buy It This Time?
Apple pushed the price ceiling for the iPhone to $1,999. After the release of the first foldable iPhone Duo, the market debate quickly centered on one issue: can high-priced foldable screens become Apple's new revenue growth driver, or will they become another niche high-end product under limited market size, rising storage costs, and margin pressures?
After the launch, Deepwater Asset Management directly doubled the Duo's revenue forecast for fiscal year 2027, calling it Apple's most important new product since AirPods in 2016. However, Morningstar, Jefferies, and Forrester were more cautious, believing that while the Duo can raise the average price of the iPhone, its sales scale and profitability still need to be verified. The Duo features a book-style foldable design, with a 7.6-inch screen when unfolded and a 5.4-inch outer screen, with a display area 50% larger than the Pro Max. The 256GB version starts at $1999, and the 2TB version at $3199. Pre-orders began on October 16 and sales began on October 23 in over 70 markets.
The Duo is important because it is the first time since AirPods in December 2016 that Apple has released a new product that people will truly want. The Duo's slim design, near-crease-free screen, and larger display area clearly exceeded expectations.
Before the event, the market expected the Duo to contribute about 5% of Apple's iPhone revenue in fiscal year 2027, but this ratio has now been raised to 10%. If one-third of Pro Max buyers switch to the Duo, the Duo could drive 5% growth in iPhone revenue and boost Apple's total revenue by 2.5%, not even accounting for consumers upgrading from cheaper models.
Apple has also split the iPhone release cycle. The iPhone 18 Pro, Pro Max, and Duo were launched first, with the standard iPhone 18, 18e, and Air 2 expected to launch next spring. Some users eager to upgrade may therefore turn to the more expensive Pro series, pushing revenue growth for the March 2027 quarter from Wall Street's expected 14% to nearly 20%. Meanwhile, the starting price of the iPhone 18 Pro increased by $100 to $1,199, and the Pro Max rose to $1,299, representing increases of about 9% and 8% respectively. The price increase can largely offset the rise in storage chip costs.
The main disagreement on Wall Street is that the iPhone contributes more than half of Apple's annual sales, and price increases for the Duo and Pro series can significantly raise the average selling price, but whether revenue growth will translate into profits remains uncertain. The Duo could become a high-priced product with limited demand, like the Vision Pro; It could also become the next Apple Watch, unable to reach the scale of the iPhone but establishing a stable market of millions of units annually.
Market Insight:
Apple is attempting to enhance the value of high-end hardware through AI, positioning the iPhone as an AI-driven smart personal hub. The new Siri AI can search for content and perform actions across personal information such as messages and emails. However, this release still does not bring significant breakthroughs in AI capabilities.
