Apple's 'drumroll begins' for 5G iPhone 12 super-cycle, says analyst

Apple's 2020 5G iPhone 12 launch could drive an upgrade super-cycle for the company, Wedbush says.

In a note to investors seen by AppleInsider, Wedbush analyst Daniel Ives says that Apple's supply chain has normalized ahead of expectations after coronavirus snarled production earlier in 2020. Ives adds that the normalization puts "Cook & Co. back in the drivers seat to launch this 5G cycle in this typical September timeframe."

Although there have been "previous reports speculating that the iPhone 12" will launch similarly to how the iPhone X rolled out, Ives now fully expects Apple to debut the lineup in late September and ship out in early October. That's in-line with its usual timeframe, and Wedbush based its current forecast on recent supply chain checks.

As with past "iPhone 12" rumors, Ives is expecting Apple to launch four iPhone models with a mix of 4G and 5G compatibility across the lineup. At least one of those devices could sport a sub-$1,000 price tag despite 5G support.

On the 5G topic, Ives said that there will likely be both U.S. and non-U.S. versions of the 5G iPhone, with only some models sporting faster mmWave 5G support. The analyst added that Apple appears to have "ironed out" technology wrinkles with 5G, further corroborating that 2020's pivotal launch will go over smoothly.

Beyond production issues, there have also been some hints that weakened demand could throw the late 2020 iPhone lineup off Apple's usual schedule.

However, Ives expects Apple to be on the verge of entering a super-cycle due to 5G. Wedbush is estimating that 350 million of Apple's current 950 million iPhones are in an upgrade window, and that lower price tags on some models could catalyze upgrades. That is driving the investment bank's longer-term bullish thesis, despite the "dark COVID-19 backdrop and a soft macro."

Wedbush's supply chains checks agree with rumors that the "iPhone 12" will launch without EarPods in the box. Ives expects that to drive demand for AirPods, which are on a trajectory to sell 85 million units in 2020. That's up from 65 million in 2019.

Going into WWDC 2020, Ives expects Apple to show off new operating systems like iOS 14, announce a move to ARM-based Mac chips, and drop "some breadcrumbs" about "Apple Glass" or other AR and wearable developments.

Wedbush's 12-month Apple price target remains at $375 from a week prior. Apple's stock is trading at $351.95 on Tuesday morning, up 2.67%.