The “iPhone 7” is not just a highly anticipated gadget for consumers; it is also a potential catalyst for Apple Inc. (NASDAQ:AAPL) stock. Since iPhone sales started slowing down, Apple stock fell deep into the doldrums. Investors are hoping that the iPhone 7 launch, which is expected to take place this September, will inject some much-needed optimism into Apple stock.
Few would have predicted that a smartphone would help build the largest company in the world, but that’s exactly what the iPhone did for Apple. With tens of billions of dollars of revenue coming in from iPhone sales each quarter, Apple has become the biggest company in the world by market cap.
Here’s what you can expect from the iPhone 7.
There Could Be Three iPhone 7 Models
If you want to buy the iPhone 7, you will likely have some decisions to make. Just like the “iPhone 6,” three will be more than one model from which to choose.
When Apple introduced the iPhone 6 back in the fall of 2014, it had two models—the 4.7-inch iPhone 6 and the 5.5-inch “iPhone 6 Plus.” According to leaked images, the iPhone 7 might actually come in be three different models: a 4.7-inch iPhone 7, a 5.5-inch “iPhone 7 Plus,” and a 5.5-inch “iPhone 7 Pro.”
And just like before, after you choose the size, you’ll also need to decide how much storage capacity you’ll need. The latest flagship iPhone come in three storage sizes: 16 GB, 64 GB, and 128 GB. (Source: “Three Alleged iPhone 7 Models Revealed in Leaked Images,” CNET, July 19, 2016.)
The iPhone 7 Pro Could Have Two Rear Cameras
Almost every smartphone on the market today has two cameras—one in the back to take pictures and one in the front for “FaceTime” and taking selfies. However, leaked images of the iPhone 7 Pro show it could have two rear-facing cameras. (Source: “Apple Could Release an iPhone 7 Pro with a Dual-Camera System,” Tech Crunch, July 18, 2016.)
Why would a smartphone need two cameras on the back? Well, a dual-lens system could improve low-light performance, color fidelity, and HDR performance. It could also improve background defocus and recreate depth of field. Basically, a smartphone like the iPhone would need two rear cameras to up its photography game.
iPhone 7: Powered by an A10 Processor
A processor is something that you don’t see from the outside but is key to the user experience of a smartphone. The “A9” processor in the “iPhone 6S/6S Plus” was quite impressive, but the iPhone 7 could have something even more powerful. The new iPhone is expected to have an “A10” processor with a 20% speed boost over its predecessor.
No Headphone Jack on the iPhone 7
Since the first iPhone came out in 2007, smartphones from the Cupertino, California-based company have always had a 3.5-mm headphone jack. Now, things are about to change. A video about an iPhone 7 dummy unit showed the lack of a headphone jack. The space is replaced by an additional speaker grill. Instead of using the headphone jack, users would be able to connect their “EarPods” to the iPhone 7’s lightning port.
Many Are Eligible for an Update
The biggest question for Apple stock investors is how many people will buy the iPhone 7. Because sales have been slowing down in recent quarters, some take this as a sign that consumers are waiting for the iPhone 7 before making their next phone purchase. On the other hand, Apple stock bears argue that sales are down simply because iPhones have lost their appeal.
Either way, here’s something to note: a lot of people bought the iPhone 6 when it came out in September 2014. In fact, 10 million iPhone 6 and iPhone 6 Plus models were sold in just three days after their official launch. Among those consumers, some bought their iPhones on two-year contracts. (Source: “First Weekend iPhone Sales Top 10 Million,” Apple Inc., September 22, 2014.)
When Apple launches the iPhone 7 this fall, those who bought the iPhone 6 on a two-year contract will be eligible for a phone upgrade. Given the brand loyalty of iPhone users, the iPhone 7 launch could be another huge event for Apple stock that’s timed just right.