In a sign that smartphone purchasing behavior is changing, new data reveals that iPhone activations in the United States have fallen to their lowest level since 2017.
According to a report from Consumer Intelligence Research Partners (CIRP), the share of new iPhone activations has fallen from a steady 40% to just 33% over the past year. This represents the largest year-over-year decline in iPhone activations seen in nearly six years, dating back to when alternatives like Windows Phone and BlackBerry were still fighting for market share against the duopoly of iOS and Android.
The results suggest that two out of three smartphone activations in the United States are now on Android deviceswhich stands in stark contrast to the high iPhone activation rates (over 60%) that Apple has enjoyed during much of the COVID-19 pandemic in recent years.
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What explains this sudden drop in iPhone purchases?
CIRP analysts point to a few potential factors contributing to this development. First, the cost of flagship smartphones has skyrocketed in recent years, while innovation has arguably stagnated. With the decrease in the number of new products and increasingly high pricesconsumers seem increasingly inclined to keep their devices longer rather than renewing them every year or two.
Improving the durability and longevity of modern high-end smartphones probably also plays a role in this regard. While devices can easily last 3-4 years, the rapid annual update cycles of the past are becoming harder to justify for many people. In addition, the CIRP notes the long-term abandonment of subsidies granted by operators, which previously masked the real cost of new smartphones. The transparency of real prices has made many people rethink their purchasing habits.
Although the iPhone’s installed base remains large, activation trends represent a worrying shift for Apple. If this is indeed a reflection of consumers’ smartphone purchasing habits, Cupertino may need to rethink its pricing and launch strategies or even introduce even more exciting new features to reignite interest. We know, for example, that the next iPhones running iOS 18 could be entitled to exclusive AI features.