Apple will launch its first foldable iPhone later this year priced around $2,000, according to Citi analyst Atif Malik. The device is expected to ship approximately 8 million units in 2026, representing roughly 3% of total iPhone shipments.
Shipments could accelerate to 20 million units in 2027 as production scales. The foldable iPhone will likely debut alongside iPhone 18 Pro and Pro Max models at Apple's annual fall event.
The launch comes as Apple faces multiple challenges. The company's stock has underperformed the S&P 500, gaining 11% over the past year compared to the index's 15% advance. Shares are down 6% year-to-date in 2026, tying with Meta for worst performance among the Magnificent Seven tech stocks.
Apple recently partnered with Google to power Siri with Gemini AI models and cloud technology. The collaboration reportedly could be worth billions of dollars to Alphabet over several years through cloud computing agreements. Google Gemini currently has more than 650 million monthly users, up from 450 million six months ago.
The AI partnership follows Apple's struggles with its own AI development. The company delayed its Apple Intelligence features for iPhone after initially touting them, with the improvements now expected in 2026. Apple previously partnered with OpenAI to handle queries Siri couldn't process, but OpenAI reportedly didn't want to remain Apple's primary AI collaborator as it develops its own devices.
Simultaneously, Apple faces chip manufacturing challenges. Nvidia has replaced Apple as TSMC's largest customer, according to analyst Tim Culpan. The AI boom has given Nvidia significant leverage with the Taiwanese chipmaker as demand for AI accelerators surges.
Apple reportedly must pay significantly more for processors from TSMC and may struggle to secure access to the latest chips. Culpan claims TSMC hit Apple with "the largest price rise in years" last fall. The analyst notes Apple now needs to fight for production capacity at TSMC's nearly two dozen fabs.
Memory chip prices are also rising due to AI data center expansion, putting further pressure on Apple's margins. Citi's Malik cut his Apple price target to $315 from $330, citing margin risks from memory chip price increases.
Approximately 50% of Wall Street analysts maintain Buy ratings on Apple. The foldable iPhone and enhanced Siri with Gemini integration could drive higher upgrade rates, according to BofA analyst Wamsi Mohan.
Apple's iOS user base exceeds 1 billion devices worldwide, while Android has billions of installed devices. Google Gemini's availability on both platforms could help Alphabet challenge OpenAI's ChatGPT, which has about 900 million weekly active users.
The combination of a premium foldable device and improved AI capabilities represents Apple's attempt to revitalize its product narrative amid competitive pressures in both hardware manufacturing and artificial intelligence, including from Android competitors like Samsung.
