Apple's basic model returns to the top after two years! iPhone 16 claims the Q1 smartphone market sales champion

According to the Zhitong Finance APP, the basic model of the American consumer electronics giant Apple Inc. (AAPL.US) — the iPhone 16 — has become the best-selling smartphone globally in the first quarter of 2025, marking the return of the basic model of the iPhone series to the top of the Counterpoint Research global smartphone sales ranking after a two-year absence.

According to the latest statistics from research firm Counterpoint Research, the iPhone 16 basic model performed particularly well in the Japan, Middle East, and Africa (MEA) markets, with the largest sales increase in Japan, thanks to significant improvements in the local economic conditions and adjustments in government subsidy policies.

Apple's more expensive flagship smartphone models — the iPhone 16 Pro Max and iPhone 16 Pro — ranked second and third on the list, while the iPhone 16e ranked sixth in the global top ten list for the month ending in March.

In addition to the iPhone, the South Korean giant Samsung Electronics' Galaxy S25 Ultra ranked seventh in sales in the first quarter. However, compared to the S24 Ultra, which ranked fifth in the first quarter of 2024, its ranking has declined, likely due to the shorter sales window for the S25 Ultra in this quarter.

Smartphone Sales — iPhone 16 Leads Global Smartphone Sales in the First Quarter (Counterpoint Research)

Counterpoint noted in its research report: "Looking ahead, despite the ongoing global trade tensions caused by the Trump administration's tariff policies and broader market demand uncertainties, the share of the top ten best-selling smartphones globally is expected to remain relatively stable. This resilience is attributed to global OEM manufacturers increasingly focusing on high-end AI smartphones, with consumer interest in more advanced and high-end AI features likely to further drive upgrade demand."

Counterpoint added that the Redmi 14C 4G launched by Xiaomi is the only non-Apple and non-Samsung smartphone model to enter the Counterpoint global top ten list.

AI — Expected to Become the Core Driving Force Behind Apple's Upgrade Cycle Soon

AI is deeply integrated into smartphones, and the prospects are incredibly broad. Currently, the motivation for Apple upgrades remains concentrated on performance upgrades for old users and the preemptive upgrade demand driven by subsidy policies for certain Apple fans. However, investment institutions on Wall Street, such as Goldman Sachs, Morgan Stanley, and Bank of America, believe that the updated Apple Intelligence (i.e., the version incorporating the most advanced Siri AI voice assistant) is expected to drive a new round of large-scale upgrade cycles The comprehensive integration of large artificial intelligence models with consumer electronic terminals such as PCs and smartphones, creating large models that can run offline with increasingly powerful inference capabilities on local devices, while also leveraging vast cloud AI computing resources to meet users' deeper personal needs, has become the core content of the "AI planning blueprint" for many technology companies worldwide.

In Apple's vision for the update and iteration of Siri, with the support of cloud and edge AI large models, the positioning of Apple Siri may no longer be a clumsy formal voice assistant. By combining cloud AI computing resources with edge generative artificial intelligence capabilities, Apple iPhone models are expected to achieve a "personal AI assistant" that better meets individual user needs, similar to the "all-around AI companion" depicted in the movie "HER." Apple has stated that the updated Siri voice assistant will be able to utilize users' personal information to answer questions and perform actions across various applications.

A research report released by Canalys indicates that the firm expects approximately 16% of global smartphone shipments in 2024 to be AI smartphones, and by 2028, this proportion is expected to grow exponentially to 54%. The compound annual growth rate (CAGR) of the AI smartphone market from 2023 to 2028 is projected to reach as high as 63%, primarily driven by strong consumer demand for AI all-around assistants and enhanced features such as edge automation processing.

The Morgan Stanley AlphaWise research report shows that American consumers are willing to pay an average of $9.11 per month for unlimited access to Apple Intelligence, an increase of 11% compared to survey data from September 2024. Additionally, the survey revealed that nearly 42% of respondents indicated that the next-generation iPhone's Apple Intelligence feature is extremely or very important; among users who may replace their iPhone in the next 12 months, this proportion rises to 54%.

Goldman Sachs expects that by mid-year, market focus will shift from tariff policies to the new generation iOS system to be released before the end of the year and the more powerful "Apple Intelligence" feature module after the update and iteration, as well as the iPhone 17 series set to be launched in the fall of 2025. Goldman Sachs anticipates that these factors will drive bullish sentiment towards Apple's stock price and the entire "Apple supply chain."