IPhone’s glory may be near its end

Apple’s results this week will likely show iPhone sales growing again, bucking a year of declines. That’s the good news.

But in a sign that customers are opting for less-expensive models, some analysts predict that the average selling price for the handsets likely declined over the holidays, a crucial period for Apple. Some purchasers are settling for older iPhone 6S models, rather than the iPhone 7, introduced in September, analysts said.

“Recent smartphone customers increasingly are opting for the iPhone 6S,” Barclays analyst Mark Moskowitz wrote in a note to clients last week as he downgraded his recommendation on Apple stock to hold. “We detect increasing concern amongindustry participants that smartphones in general have evolved technologically to become more than good enough to serve most users’ digital needs over multiple years or until the device breaks.”

Apple is scheduled to report quarterly results on Jan. 31. Analysts currently predict an average selling price, or ASP, of $688 for the iPhone line in the holiday quarter, down from $691 a year earlier, according to estimates compiled by Bloomberg News. That’s even though the iPhone 7 Plus model cost $20 more than the iPhone 6S Plus when it was introduced. A new iPhone launch has in previous years consistently led to an increase in ASP.

An ASP decline may suggest the iPhone 7’s better camera, faster processor, improved battery life and water resistance weren’t enough to draw customers away from the 6S. The trend would underscore concern that smartphone advances nowadays aren’t enough to maintain the iPhone revenue growth bonanza that the Cupertino, Calif.-based company used to enjoy.

“We know what a smartphone looks like and does,” billionaire technology investor Peter Thiel told the New York Times recently. “It’s not an area where there will be any more innovation.”

Apple’s revenue decline in the last fiscal year, which ended in September, represented the first such drop since 2001, as falling iPhone sales dragged down the total. Industrywide smartphone shipments were likely flat in 2016, according to researcher IDC. As recently as the second quarter of 2015, the market was growing more than 10 percent a year.