Apple has used fairly transparent methods to increase average revenue per iPhone sold in recent years. This includes introducing unnecessary differences between the cheaper basic iPhones and the more expensive Pro models. We are now at the point where the basic models like the current Apple iPhone 15 are getting older chipsets. This allows Apple to save a few dollars on hardware costs and increase its profit margin. That could change with the Apple iPhone 16.
The tip comes from a research note by analyst Jeff Pu of Haitong International Securities in Hong Kong. Pu is an expert on Apple in general and all topics related to iPhone supply chains in particular. He also has a good track record when it comes to leaks. According to the latest report from Pu, something will now change in the strategy described above next year. Accordingly, all four Apple iPhone 16 models get the same A18 Bionic chipsets. That would be a noticeable difference from this year’s lineup. The iPhone 15 and iPhone 15 Plus are currently running on the old A16 Bionic. The iPhone 15 Pro and iPhone 15 Pro Max instead have the new A17 Pro chipset under the hood.
Now you might think that Apple will finally stop making the chipset’s capabilities one of the main arguments for buying the Pro series. Instead, all four models will get an A18 chip in 2024. Apparently the base models will be running on the base A18 and the iPhone 16 Pro and Pro Max on the A18 Pro. According to Pu, this restores the usual distinction.
In this way, Apple could eliminate the current impression that the basic iPhones use old processors, which is actually the case with the iPhone 15. In addition, the iPhone 16 with the new, current A18 platform is moving closer to the Pro iPhones. Apple is still working diligently on its margins. The A18 and A18 Pro are manufactured by TSMC using the second generation 3nm “N3E” process. According to TSMC, version 2 is expected to be both more cost-effective and deliver better yields than the A17 Pro chip’s N3B process.