The foldable iPhone duo is the clear standout from Apple's (AAPL) event and is dominating the conversation. Interest is high, though affordability raises questions. Foldable phones are new for Apple but have existed for about half a decade. Samsung sells them, especially in the United States, and Google (GOOGL) makes the Pixel version. Apple took its time, then shipped a first-generation product that beats where Samsung's Gen 7 and Gen 8 devices currently stand.
The duo will sell well and sell out, partly because supply will be tight on such a complicated device. It starts at $2,000, far above what people pay for phones. For someone who wants a new iPhone and also likes having an iPad mini, buying one device that does both makes sense. For anyone coming from a last-generation iPhone, it is a big ask. The foldable category as a whole will grow, but it will take a couple of generations for the average buyer to get on board.
Pricing on the iPhone 18 line
The iPhone 18 Pro and 18 Max each cost $100 more. A price rise was expected, but several analyst notes warned the increase was not enough to offset margin pressure. My read: Apple is eating a lot of the cost and raising prices on MacBooks, iPads, and other products instead of pushing iPhone prices as high as possible. The iPhone makes up over 50% of Apple's business, so the company does not want to raise its price too much. A $100 increase is small compared with some other companies; it could have been $200, which would have mattered more. Apple is moving numbers around to keep the iPhone line as affordable as it can.
The AI release
Apple announced upgraded AI, a new operating system, personal context, and a feature that shows whether a photo is authentic or AI-created. Apple is widely called a laggard in the AI race, but it is catching up. So far AI has not been a big seller for consumer devices and is not a reason to upgrade. The image authentication feature is a good idea and helps the conversation, but it will drive upgrades only for a niche group who need it. There are other good reasons to buy the iPhone 18 Pro and Pro Max.
One view is that the AI release was the real headline people missed, because of personal context. There are 2.5 billion devices in the Apple ecosystem, users already trust it, and personal data is already stored there, so the AI does not need to be fed information. That could deepen ecosystem stickiness.
The open question is usability and function. Demos show things like a text arriving and the phone booking a restaurant reservation, which is neat, but the average person does not actually do that. It comes down to a killer feature people decide they cannot live without, and that has not appeared in the consumer AI space yet. Enterprise is different. I am cautious here. Apple is in a strong financial position to pursue AI and is not as heavily invested as some other companies, which helps. Still, there are few killer products or reasons to upgrade for these features. That may change in a couple of years, but right now there is little there.
The market liked the response. This was John Ternus's first event as CEO, and the stock rose two and a half percent.
