Apple shares came under pressure on Wednesday after the company unveiled its latest iPhone lineup which includes its first foldable smartphone.
This is as investors assessed whether the new products can provide enough momentum to justify the company’s elevated valuation.
Apple shares opened at $315.50 on September 9, compared with Tuesday’s closing price of $316.22. The stock fell as low as $310.97, representing a decline of $5.25, or about 1.66 percent, from the previous close, before recovering some of the losses.
The company presented the iPhone 18 Pro and Pro Max. Its first foldable iPhone, dubbed iPhone Duo, as well as new AirPods and Apple Watch models.
The shares later recovered some of the losses and were trading around $315.11, according to market data.
The reaction came despite what could be one of Apple’s most significant product launches in years. The iPhone Duo represents the company’s entry into the foldable smartphone market, while the event also marked the first major product presentation under new CEO John Ternus, who took over from Tim Cook on September 1.
The foldable iPhone Duo will start at $1,999 and is expected to go on sale on October 23. Apple also priced the iPhone 18 Pro at $1,199 and the Pro Max at $1,299, representing $100 increases over their predecessors, according to Investor’s Business Daily.
The muted stock reaction suggests that investors were looking beyond the launch and towards what the products could mean for Apple’s revenue growth, margins and competitive position.
Why Apple shares did not surge after the launch
For Apple, a major product announcement does not translate into an immediate rise in its share price.
Many of the information surrounding the iPhone launch had already been anticipated by investors and widely reported before the event. This may reduce the potential for a major positive surprise when Apple finally unveils the products.
Dow Jones Market Data showed that Apple shares have historically fallen an average of 0.31 percent on days when the company introduces new smartphones.
Foldable iPhone raises the stakes for Apple
The iPhone Duo could become important to Apple’s longer-term growth strategy.
Apple entered the foldable market later than several competitors, but the company is betting that its ecosystem, brand strength and hardware-software integration can help it establish a premium position in the category.
The device opens into a 7.6-inch display and supports Apple Pencil functionality, making it more than a smaller version of an existing iPhone.
The $1,999 starting price also positions the device at the premium end of the market. For Apple, that creates an opportunity to increase revenue per device if consumers are willing to pay for a new one.
However, the company will need to demonstrate that the foldable can expand the iPhone market rather than shift existing customers from conventional premium models.
AI remains a bigger question for investors
Beyond the hardware, Apple’s artificial intelligence strategy remains one of the issues investors are watching most closely.
Ternus presented the iPhone as an ‘intelligent personal hub’ with an upgraded Siri and Apple Intelligence features forming part of the company’s broader software strategy.
Apple said its AI capabilities will rely on on-device processing where possible and private cloud computing when greater processing power is required.
This also matters because Apple has faced questions over whether it is moving quickly enough in generative AI compared with rivals such as Alphabet and other major technology companies.
The new iPhone has to do more than sell hardware. Apple needs the device to demonstrate that its AI strategy can strengthen the ecosystem that keeps customers buying iPhones, subscribing to services and remaining within Apple’s platform.
Ternus early test
The market reaction also puts an early spotlight on Ternus.
His first major product launch as CEO was closely watched because he inherited a company with enormous financial strength but also significant expectations around its next phase of growth.
The former hardware engineering chief now has to convince investors that Apple can continue producing products capable of creating new revenue opportunities while maintaining the margins and customer loyalty built during Cook’s tenure.
The initial share-price reaction suggests investors are not yet ready to give the new products a blank cheque.
Instead, Wall Street will likely judge the launch over the coming months through pre-orders, sales of the iPhone Duo, holiday-season demand and Apple’s financial results.
For Apple, Wednesday’s launch is likely less about whether investors liked the presentation and more about whether the new products can translate excitement into higher sales and sustained earnings growth.