Apple has launched the iPhone 17 series, drawing strong early demand despite criticism of limited AI innovation at its 2025 fall event. Solid preorders are expected to boost upstream suppliers — ranging from PCBs and passive parts to camera modules, displays, and memory — through the second half of the year.
Suppliers initially braced for a sluggish 2025, hit by tariff pressure and Apple's unusual early restocking. Many looked to AI server demand to offset flat handset orders. Sentiment improved in September when Taiwanese vendors confirmed Apple had firmed up iPhone 17 delivery schedules.
The iPhone 17 launch is expected to trigger a shipment peak by month's end, lifting third-quarter revenues for suppliers including Zhen Ding Technology (ZDT), Compeq, Unimicron, Kinsus, Flexium, Tripod Technology, Yageo, and Largan Precision.
Market demand divergence between Apple and rivals
Apple's order pipeline has brightened, but suppliers warn demand for rival brands is cooling as China ends handset subsidies. For vendors serving both ecosystems, the market outlook remains uneven.
A Taiwanese distributor survey suggests the smartphone sector is entering a three-year upgrade cycle, with iPhone 17 shipments forecast to climb up to 20% year-over-year.
A19 chip upgrade becomes the main attraction
Nearly one-third of consumers see the A19 chip upgrade as the iPhone 17's standout feature, highlighting how stronger edge AI performance is now a key driver of replacement demand, even as Apple Intelligence grabs headlines.
Other draws include a lighter chassis (17%), dual-side selfie mode (14%), longer battery life (13%), a 48-MP camera (12%), and stronger zoom with 8K video (10%) — tangible upgrades in design, imaging, and efficiency.
For suppliers, hardware changes are modest beyond the A19 chip and premium camera modules. PCB makers see a bigger upside in Apple's rumored foldable iPhone, expected in 2026, which could lift both pricing and volumes.
Consumer trade-offs and channel dynamics
Analysts caution the iPhone 17's incremental changes may not spark mass upgrades, as many buyers are flocking to discounted iPhone 16 Pro and Pro Max units. Trade-in deals are proving crucial, lowering entry costs and sustaining demand.
With limited breakthrough features and rising economic uncertainty, industry watchers say Apple and its suppliers must lean on lower upgrade costs to fuel demand and support peak-season momentum.
Article edited by Jack Wu
