Is Apple Inc.’s iPhone an economic indicator?
The newest phone lineup, which officially became available last week, can at least pinpoint three crucial themes in the economy, according to UBS strategists.
The first is the pervasive nature of geopolitics, which is evident in Apple’s
AAPL,
supply chain for the iPhone 15.
“Apple’s new iPhone will contain an advanced chip designed by Apple in the US but manufactured in Taiwan, and the iPhone itself is largely assembled in China,” notes the UBS team. “This embodies the complex global supply chain necessary to produce advanced technologies.”
See also: Is Apple’s iPhone 15 pricing strategy a risky bet or right for this economy?
The iPhone 15 also highlights a “circular” economy, the UBS team says.
“Apple has been stepping up efforts to encourage recycling, through discounts on upgrades and reclaiming the materials in older devices,” according to UBS. “This hints at the value of the underlying parts.”
The iPhone 15 Pro and Pro Max feature batteries made of 100% recycled cobalt, while they also have 100% recycled copper in their main logic board, among other recycled elements.
Further, Apple put USB-C ports on its new phones, in the wake of regulations in Europe calling for universal charging ports that could help cut down on electronic waste. “We see Apple’s design change as indicative of what’s to come as companies look to reduce reliance on increasingly scarce materials,” the UBS team wrote.
And while the economic preferences have shifted toward experiences instead of services following the post-COVID economic reopening, it’s notable that the iPhone business continues to hold up, especially when other areas of consumer electronics have been sluggish.
Perhaps that’s because Apple’s phones span the line between object and experience.
“While iPhones are a consumer ‘good,’ Apple appears to be placing a greater focus on providing consumer experiences,” the UBS team wrote, keying in on enhanced opportunities for game developers brought about by the new A17 chip. “Apple has also said its upcoming software update will enable developers to create spatial content that can be viewed later on Apple’s VisionPro headset.”
Read: What’s a better deal — buying an iPhone 15 or investing $800 in Apple stock?
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