Sherwood News

We are so far past peak iPhone hype

Cheaper, AI-powered, and missing a few frills — can the 16e turn things around for Apple’s iPhone?

2/20/25 10:56AM

Five months after the latest iPhone hit the shelves, Apple just dropped a more affordable version: the iPhone 16e.

The 16e sheds some extras like the ultrawide camera and faster wireless charging, but the price, which will start at $599 in the US, is perhaps best summarized as kind-of-wallet-friendly-but-not-as-cheap-as-some-people-hoped. After all, the 2022 iPhone SE, which is now discontinued, was just $429.

Some analysts are blaming the slightly higher-than-expected price on looming tariff threats. But, whatever the reason for the final price, the only question for Apple is: will this latest release breathe some life into slumping iPhone sales?

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Indeed, the 16e comes as new iPhone hype keeps fading and Apple feels the pinch in core markets. In the US, Apple’s largest region, nearly one-third of iPhone users had held on to their devices for over three years as of last March — up from just 6% in 2015, per CIRP — as buyers struggle to justify getting the latest iPhone unless their current one is on its last legs.

Things are rougher in China, Apple’s second-largest national market: iPhone sales dropped 17% year over year, its steepest annual decline in the region since 2016, losing ground to local brands like Huawei and budget phone maker Vivo. Missing AI features might explain some of that underperformance in China, though it seems that Apple Intelligence is beloved by Apple execs but often berated by some of its users.

With its quarterly revenue slipping despite the holiday season, Apple’s new budget iPhone feels crucial. In 2024, iPhones still made up over half of Apple’s revenue, raking in a whopping $201 billion. But you don’t see many people queuing outside the Apple stores like they used to, and that’s a problem for the world’s largest company.

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JetBlue is raising its bag fees as fuel costs squeeze airlines

JetBlue will reportedly hike its bag fees, as the cost of jet fuel continues to climb amid the war in Iran. It’s the latest example of carriers finding ways to push rising costs onto travelers.

Last week, United Airlines CEO Scott Kirby said that if fuel prices remain elevated, fares would need to rise another 20% for his airline to break even this year.

As CNBC reported, when one airline raises fees, others tend to follow.

Earlier this month, JetBlue hiked its first-quarter outlook for operating revenue per seat mile to between 5% and 7%, saying that strong Q1 demand helped “partially offset additional expenses realized from operational disruptions and rising fuel costs.” Now, the carrier appears to be making moves to further boost revenue to offset those costs.

Earlier on Monday, JetBlue rival Alaska Air lowered its Q1 profit forecast. The refining margins for the carrier’s cheapest fuel option — sourced from Singapore and representing about 20% of Alaska’s overall supply — have spiked 400% since February.

JetBlue did not immediately respond to a request for comment.