The iPhone 17 Upgrade Wave Has Arrived. And It’s Changing the Game for Apple

When Wedbush Securities analyst Dan Ives raised his target for Apple stock to $320, he framed it as a response to something tangible: the iPhone 17 is off to a stronger start than even the bulls expected. Early channel checks suggest sales are roughly 10 %–15 % ahead of the iPhone 16 at a comparable point in its launch.

That number may sound modest, but it is significant for a company that has spent much of the last few years battling upgrade fatigue. According to Investing.com, more than 315 million users have not replaced their iPhones in at least four years. This pent-up demand gives Apple a chance to reignite its core hardware business and, by extension, the services that orbit it.

The optimism marks a reversal of sentiment from just a year ago. Analysts had written off major iPhone launches as incremental, with few features to tempt owners of recent models. Yet Investopedia noted that precisely those low expectations may be what set the stage for a stronger-than-anticipated rebound.

The upgrade spark

The first hints came from China, where preorder data showed longer waiting times for Pro models and unexpectedly brisk demand for the base iPhone 17. MarketWatch reported that delivery times were stretching into December for certain configurations. Similar patterns appeared in the US and Japan.

Part of the appeal, according to IG, is that the entry-level device feels more substantial than before, while the Pro models add clear differentiators in performance and camera technology. The weaker response to the iPhone Air, meanwhile, reflects the difficulty of finding a sweet spot between price and power.

Wedbush’s research note also highlighted China as a “linchpin” for the cycle. After two years of softer demand and political friction, the firm believes Apple is regaining market share. For investors, that is as important as the hardware itself, since China still represents about one-fifth of Apple’s revenue.

The services engine behind the screen

Hardware momentum only tells part of the story. Every new iPhone sold becomes another node in Apple’s services ecosystem — the App Store, Apple Music, iCloud, TV+, and now the nascent Apple Intelligence platform. Wedbush described services as “the foundation of Apple’s growth,” arguing that a growing device base translates into recurring, high-margin revenue.

AppleInsider calculated that services could reach nearly $120 billion in annual sales within two years if the upgrade wave holds. That would give Apple a recurring revenue stream larger than the entire Fortune 100 average company. It also strengthens investor confidence that Apple can expand margins even if hardware growth later moderates.

Artificial intelligence is part of that story. Barron’s reported that Wedbush sees AI features as worth $75–$100 per share in potential valuation uplift if Apple executes effectively. While Apple’s approach to AI has been cautious, the firm’s enormous installed base gives it a ready-made audience once new tools roll out system-wide.

A few cracks beneath the gloss

There are caveats. AlphaSpread noted that Apple’s revenue in Greater China still fell in recent quarters despite improvement in unit sales. The competitive pressure from Huawei and other local brands remains real. If Apple’s mid-range models stumble or if China’s recovery stalls, the upgrade cycle could peak earlier than Wedbush expects.

Valuation is another concern. With Apple trading near record highs, the $320 price target implies limited upside unless earnings growth accelerates sharply. Investors.com cautioned that “the stock is priced for near-flawless execution,” meaning any slip in production, logistics, or demand could hit sentiment fast.

Wedbush also flagged tariff and supply-chain costs, estimating about $1.1 billion in additional expenses last quarter. Shifting more production to India and Vietnam may alleviate long-term risk but could create short-term friction.

Why this time feels different

Despite the caution, the tone across Wall Street is more hopeful than it has been in years. The iPhone 17 cycle appears to combine scale, timing, and ecosystem leverage in a way previous launches did not. Apple has balanced meaningful hardware upgrades with a steady hand on pricing, allowing it to capture both premium and mainstream demand.

As Seeking Alpha put it, this looks like “a true replacement cycle rather than another refresh.” The services division, now generating nearly a quarter of Apple’s total revenue, amplifies that dynamic. Each hardware sale adds long-term value through recurring subscriptions and cloud storage.

The cultural element matters too. Apple’s devices continue to act as status symbols in many markets, but they also form an increasingly invisible infrastructure for payments, entertainment, health data, and work. That stickiness is what keeps the upgrade cycle sustainable once it begins.

The road ahead

Apple’s December-quarter guidance will be the next test. Analysts expect revenue of about $127 billion, up roughly 5 % from a year earlier. The holiday season will reveal whether the early demand indicators translate into real sell-through. Investors will also be watching average selling prices and margins: if Pro models dominate, profit growth could outpace volume growth.

Beyond the numbers, attention is turning to Apple’s AI roadmap. The company is expected to showcase deeper integration of Apple Intelligence and Siri enhancements early next year. A convincing AI narrative could reinforce the view that Apple’s next decade will be driven as much by software and services as by devices.

The wildcard remains China. A revival there could turn this from a good cycle into a great one. A stumble could expose how dependent Apple still is on a single market for growth. As Reuters noted, “China remains both Apple’s biggest risk and its biggest opportunity.”

The takeaway

Wedbush’s call on Apple is more than a price-target tweak. It captures a sentiment shift: the sense that after years of plateauing upgrades, the company has rediscovered its rhythm. If the iPhone 17 cycle continues to outpace its predecessor and services growth compounds in step, Apple’s “long flat” era may finally be ending.

Or as Ives himself put it in his note to clients, “This is the start of a multi-year upgrade cycle that redefines Apple’s growth trajectory.” Investors who have been waiting for that spark may finally have their signal.