Apple Poised for Market Share Gains as AI Drives Faster Smartphone Upgrades, Citi Says

The introduction of artificial intelligence features is set to accelerate smartphone upgrade cycles, with Apple Inc. (AAPL) particularly well-positioned to capture additional market share, according to a new survey from Citi published Tuesday.

Shorter Upgrade Cycles Emerge

Citi's survey found that consumers across all regions now plan to replace their smartphones more frequently. The average holding period has shortened to a range of 2.1 to 2.7 years, a significant decrease from the 2.9 to 4.3 years observed in previous cycles.

Analysts attribute this trend to growing consumer demand for AI-enabled devices. The survey highlighted that this demand is particularly strong in China and the United States. Interest in foldable smartphones also showed strength, especially in the U.S. and UK markets.

Apple Positioned for Growth

For Apple, the findings suggest a period of potential growth. The survey revealed that consumer purchase consideration for iPhones exceeded the company's current ownership levels across all markets, signaling a strong potential for market share gains. This is reportedly driven by owners of older iPhones seeking to access new features like Apple Intelligence.

Furthermore, the survey noted that the penetration of Apple Services has grown, indicating deeper engagement within the company's ecosystem. This robust user loyalty and service adoption provides a strong foundation for hardware sales.

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Broader Tech Market Impact

The trend toward AI-powered devices extends to the personal computer market. According to Citi, purchase intentions point to market share gains for Apple's Mac computers across all regions. The demand for AI-capable PCs was particularly pronounced in China and the U.S.

Citi stated this development is a positive catalyst for leading PC manufacturers, including:

• Lenovo (LNVGY)
• Dell (DELL)
• Apple (AAPL)
• HP (HPQ)

In the tablet market, the iPad maintained its dominant position, though competitors like Samsung (005930), Google (GOOGL), Xiaomi (1810), and Huawei showed increased purchase consideration in some markets.