JP Morgan drops Apple to $230 over low iPhone 15 expectations

Investment firm JP Morgan believes that Apple's current problems with the Chinese government will spread, and that there are no "material upgrades" to tempt buyers in the iPhone 15 range.

In August, JP Morgan raised its Apple target price to $235, on the basis of both a "robust shareholder return" for 2023, and for how its services mean it is not dependent on product cycles.

Now, however, in a note to investors seen by AppleInsider, JP Morgan has dropped its bullish opinion, and also cut the price target by $5, to $230.

"Are there material upgrades with iPhone 15?" write the analysts. "No, but the volume cycle is likely to be driven by replacement/upgrades of the large installed base."

"The primary change for the average consumer will likely only relate to the updated casing," it continues, "which is expected to be titanium (for Pro models) relative to stainless steel in the current generation, giving iPhone 15 a different look and feel than the current generation."

"Should we expect a price increase? We think a price increase across all tiers will preserve the recent shift towards a richer mix," says JP Morgan. "[We] believe it is more likely that Apple takes pricing across all iPhones rather than only on the Pro models, as a widening gap in pricing between base models and Pro models will decrease the incentive for consumers to choose the higher-end devices for feature upgrades and limit the mix tailwinds that have benefitted Apple in prior years."

China's government recently appeared to ban iPhones amongst its staff, and that did send Apple's share price dropping by an unwarranted amount. JP Morgan agrees that Apple won't be affected by that government decision, but says that's not the only issue.

"We believe the stand-alone risk is modest, but will amplify the challenges in China," it says. "Apple's market share in the China market has increased steadily in the last few years, led by better product cycle drivers as well as a moderating competitive landscape with the other primary high-end smartphone OEM, Huawei, pulling back its presence from the market."

iPhone 14 vs. iPhone 15 Shipments (units in millions) (Source; JP Morgan(

"We do not expect the restriction imposed on ownership of iPhones by government employees to have a material impact on the volume outlook," it continues, "as previous restrictions to a similar nature have shown limited evidence of changing consumer purchasing behavior."

"That said, the restrictions are coinciding with the recent launch of Huawei Mate 60 Pro (e.g., Huawei's 5G smartphone)," says JP Morgan, "and the restrictions will make it tougher for Apple to continue to deliver share gains in the local market."

JP Morgan also attributes its decision to cut the price target to how "iPhone volume expectations are low given multiple headwinds."

In previous years, it says there has been higher investor expectation ahead of an iPhone launch, but that isn't present this time. The company says this down to how "the combination of consumer spending headwinds and a tougher competitive landscape [is] expected to drive challenges to sell-through volumes for both iPhone 15 as well as iPhones more broadly."

JP Morgan's expectation that all iPhones will see price rises goes against most analysts predictions of only the Pro models increasing — and Morgan Stanley's belief that solely the iPhone 15 Pro Max will be costlier than before.

Apple will unveil its iPhone 15 range, and the new US pricing, at its September 12, 2023 event.