Piper Sandler’s recent survey reveals that teenagers continue to favor the iPhone as their preferred smartphone. Yet, while Apple holds a strong position in the teen market, it faces challenges with its services. Rising tariffs threaten to inflate iPhone prices, which could jeopardize Apple’s future appeal among younger consumers. The survey indicates a notable increase in the number of teens wanting an iPhone, rising by 3% since April 2024.

Apple has consistently dominated the teen demographic, with a significant majority owning iPhones for years. Despite this impressive presence in smartphone sales, Apple is missing out on potential revenue from its subscription services. Services like Apple TV+ and Apple Music are not gaining traction among teenagers. In fact, while 45% of teens surveyed subscribe to Spotify, only 30% have Apple Music subscriptions.

This discrepancy highlights a missed opportunity for Apple, as subscription services provide a more sustainable revenue stream beyond one-time hardware sales. As we look to the future, there are concerns surrounding the iPhone’s market position. Recent tariffs imposed on China could lead to drastic price increases for iPhones. Given that many teens rely on their parents for smartphone purchases, convincing them to pay for an expensive device in the range of $3,500 may be challenging.

Currently, Apple has stocked up on iPhones to mitigate immediate impacts. However, it remains uncertain what will happen once this supply runs out. Unless there are changes to tariff policies or negotiations with the government to alleviate the financial burden, the iPhone’s future in the U.S. market could be at significant risk.