On April 7, market reports suggesting a potential delay in the launch of Apple's first foldable iPhone sparked investor concerns. Shares of Apple (AAPL) fell approximately 2% on the day, underperforming the S&P 500 by 225 basis points, and closed at $253.50.
According to analysis, Morgan Stanley analyst Erik Woodring, after conducting supply chain checks, indicated that the stock decline lacked fundamental justification. Both his supply chain information and independent reports from Bloomberg suggest that the release timeline for the foldable iPhone remains unchanged, with the original September launch plan highly likely to proceed as scheduled. Technical challenges encountered during the EVT (Engineering Verification Test) phase are a normal part of the research and development process; this stage is specifically designed to identify and resolve issues. The reported hinge problem is expected to be rectified before mass production begins in the summer.
Morgan Stanley reaffirmed its Overweight rating on Apple, maintaining a price target of $315, which implies an approximate 24% upside from the current share price. The firm views the recent pullback as a potential buying opportunity for existing investors.
Conflicting reports triggered market volatility. On April 7, 2026, Nikkei Asia initially reported that Apple's first foldable iPhone faced technical setbacks during engineering testing, potentially delaying its mass production and shipment schedule. Subsequently, media outlets like MacRumors cited sources indicating the delays were related to stalled pricing negotiations with manufacturing partners and an undetermined final material solution for the hinge.
However, just hours later, Bloomberg published a report stating clearly that Apple's first foldable iPhone is still on track for release later this year, aligned with the regular iPhone launch cycle.
Morgan Stanley promptly conducted supply chain checks, which revealed that a core iPhone component supplier confirmed it had not observed any order adjustments related to the foldable iPhone. Based on this, the firm maintained its existing forecasts for 2026 iPhone shipments and seasonal patterns.
Encountering engineering issues during testing phases is not uncommon. Every Apple hardware product undergoes three testing phases before mass production: EVT (Engineering Verification Test, typically starting in early spring), DVT (Design Verification Test), and PVT (Production Verification Test, the final pre-production check). The foldable iPhone is currently in the EVT phase, where initial testing identified engineering challenges related to the hinge for the new foldable screen.
Morgan Stanley cited two historical examples for context:
iPhone 15 Pro: During EVT, an issue with a haptic touch function was discovered, forcing Apple to revert to mechanical buttons. This adjustment did not, however, impact the final launch date.
iPhone X (2017): Low yield rates for the 3D-sensing TrueDepth camera system resulted in the iPhone X, although announced in September, having its supply availability delayed by approximately two months compared to other new models.
The current development and testing cycle for the foldable iPhone is proceeding normally, with no unusual fluctuations in the supply chain, and the September release schedule remains intact. For long-term investors optimistic about the transformative potential of the first foldable iPhone and the broader Apple Intelligence ecosystem, this market overreaction may present a strategic entry point.
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