This fall, for the first time ever, Apple (NASDAQ: AAPL) rolled out three new iPhone models at once. One of those options -- the iPhone X -- was the most expensive iPhone ever, priced at $999 for the 64 GB version and $1,149 for the 256 GB version. Furthermore, the iPhone X didn't go on sale until six weeks after the iPhone 8 and iPhone 8 Plus became available.
Apple was operating from a new playbook this fall. As a result, it was hard to predict in advance how the three phones would sell in comparison to one another.
The iPhone X has only been out for a month. However, it's already clear that it will be just as big a hit as Apple bulls expected. Indeed, Apple fans' willingness to pay top dollar for iPhones has ratcheted up dramatically this fall.
iPhone X usage surges ahead
The iPhone 8 and iPhone 8 Plus saw an initial burst of sales when they hit the market in late September, as is typical for new iPhone models. Nevertheless, it quickly became obvious that demand for these models was much lower than for prior new iPhone releases, based on usage statistics and the lack of meaningful supply constraints.
Demand for the iPhone 8 and iPhone 8 Plus has been moderate. Image source: Apple.
This demand pattern was not especially surprising, given that the iPhone X release was delayed to early November. What wasn't clear was whether most potential customers were holding out for the iPhone X or whether they just wanted to compare all three models and might ultimately buy the cheaper iPhone 8 or iPhone 8 Plus.
The former explanation appears to be correct, based on iPhone usage statistics from Mixpanel. The iPhone X overtook the iPhone 8 in terms of usage before Thanksgiving, and it surpassed the iPhone 8 Plus by the end of November.
There is still a lot of pent-up demand
The iPhone X is already the usage leader among the three iPhone models released this year, but it is set to continue gaining ground. Whereas the iPhone 8 and iPhone 8 Plus have been readily available for months, the iPhone X is still on backorder worldwide. This indicates that supply (rather than demand) is the primary constraint on iPhone X sales.
To be fair, Apple has reduced iPhone X lead times significantly over the past month. Recently, it has been promising delivery in as little as eight days for orders placed through its U.S. online store. On the other hand, retail inventory remains minimal. Most Apple Store locations are still sold out of most iPhone X configurations.
The Chinese New Year could give a further boost to iPhone X demand in early 2018. After all, Apple has been particularly successful in China when it has released iPhone models with a brand-new "iconic" design.