Goldman Sachs Predicts 5% Revenue Boost for Apple with iPhone 17 Series

Goldman Sachs has expressed optimism about the upcoming iPhone 17 series, predicting that the new lineup will drive revenue growth for Apple. The investment bank anticipates that the iPhone 17 series will stimulate user upgrades through product line adjustments, performance enhancements, and a subtle pricing strategy. This is expected to result in a 5% year-over-year increase in iPhone business revenue for the 2025 fiscal year, with a further acceleration to 7% in the 2026 fiscal year.

The iPhone 17 series is set to feature significant updates and strategic pricing, which are expected to boost user demand for upgrades. Apple has announced that its highly anticipated "Awe Dropping" special event will take place at 1 AM Beijing time on September 10. Market expectations include the launch of a new ultra-thin iPhone, a new Apple Watch with satellite connectivity, and the much-anticipated AirPods Pro 3. Prior to this event, Goldman Sachs reiterated its "buy" rating for Apple stock, citing optimism about the iPhone 17 series' product form updates, potential price increases for Pro models, and ongoing device promotion competition among U.S. carriers.

Goldman Sachs' positive outlook is based on a comprehensive analysis of the iPhone 17 series, including its product lineup, performance upgrades, and pricing strategy. Analysts believe these changes will not only attract users with older devices to upgrade but also effectively increase the average selling price of the products, providing a new impetus for Apple's growth.

The iPhone 17 series is expected to introduce four new models, marking a significant adjustment to the product lineup. The lineup will include the iPhone 17 (base model), iPhone 17 Pro, iPhone 17 Pro Max, and a new iPhone 17 "Air" model, which will replace the existing "Plus" model. The most notable change is the introduction of the "Air" model, which is reported to be lighter and thinner than other iPhone models. Its display size will be between the 6.3-inch iPhone 17 Pro and the 6.9-inch Pro Max. Additionally, the base model iPhone 17's screen size will increase from 6.1 inches to 6.3 inches, aligning with the Pro models.

The iPhone 17 series is expected to see a significant hardware performance boost to support Apple's growing AI functionality. The new series will feature the upgraded A19 series processor and increased memory from 8GB in the iPhone 16 to 12GB. The iPhone 17 Pro and Pro Max models will be equipped with the high-end A19 Pro chip, while the base and Air models may use the slightly less powerful A19 base version or a downgraded A19 Pro chip. The enhanced chip performance and larger memory capacity are seen as preparations for the upcoming Apple Intelligence feature updates, including the anticipated AI-enhanced Siri in 2026. Additionally, the front-facing camera across the iPhone 17 series is expected to upgrade from 12 million pixels to 24 million pixels.

In terms of pricing, Goldman Sachs predicts that Apple may adopt a subtle pricing strategy to increase the average selling price of high-end models. Analysts expect the starting prices for the base model iPhone 17 (128GB at 799 USD) and the Pro Max model (256GB at 1199 USD) to remain consistent with previous generations. However, for the iPhone 17 Pro model, Apple may eliminate the 128GB storage option, making 256GB the new entry-level configuration with a starting price of 1099 USD. This strategy is similar to Apple's approach with the iPhone 15 Pro Max, where the elimination of the 128GB version effectively raised the starting price from 1099 USD to 1199 USD. The new iPhone 17 Air model is expected to be priced similarly to the iPhone 16 Plus at 899 USD.

Overall, Goldman Sachs believes the iPhone 17 lineup is sufficient to support revenue growth from the 2025 fiscal year to the 2026 fiscal year. From the demand side, larger base model screens, improved front-facing cameras, and more powerful processors will drive device upgrades, especially for users with devices older than three years or those whose devices cannot support Apple Intelligence (iPhone 15 Pro and below). From a pricing perspective, the subtle price increase achieved by eliminating the entry-level storage option for Pro models will gradually raise the overall average selling price as iPhone shipments shift towards the high-end market. However, Goldman Sachs holds a neutral view on the impact of the iPhone 17 Air model, as its lightweight design may attract some consumers, but reported compromises in battery capacity and rear camera (single lens) may reduce its appeal compared to the base model.