Apple's iPhone 17e had a promising debut in Japan, but the honeymoon didn't last. According to a new report from Counterpoint Research, cumulative sales of the iPhone 17e hit 1.17 million units in the first seven weeks after launch — that's 9.8% less than what the iPhone 16e managed over the same period.

The iPhone 17e actually outperformed its predecessor during the first two weeks, suggesting strong initial demand. But by week four, sales started slipping behind the iPhone 16e, and they never caught up.

Before you start worrying about Apple losing its touch in Japan, Counterpoint says the culprit isn't a weaker product — it's a math problem. The iPhone 16e had an unusually good run because it arrived at the perfect time to capture a wave of upgrades from users of older iPhone SE models (think 2020 and 2022 versions). Counterpoint calls the iPhone 16e a "demand-clearing" model in Japan, meaning it soaked up a ton of pent-up replacement demand in a short period.

"While this may appear to signal weakening performance, it is more accurately attributed to the high base effect created by the 16e rather than any deterioration in product competitiveness," the report said.

The iPhone 16e also had another trick up its sleeve: it was the most affordable way to get into Apple Intelligence, which gave upgrade-hungry users another reason to pull the trigger. Since the iPhone 17e launched just a year later, there simply weren't as many people ready to upgrade again. Counterpoint expects replacement demand in Japan to gradually recover around 2027, helped by the country's widespread two-year trade-in programs.

So, for now, it's not that the iPhone 17e is a dud — it's that the iPhone 16e was a tough act to follow.

Looking ahead, the next big catalyst for Apple's stock will be its earnings report, expected around July 30, 2026. Analysts are forecasting earnings per share of $1.89 (up from $1.57 a year ago) on revenue of $108.95 billion (up from $94.04 billion). The stock currently trades at a price-to-earnings ratio of 37.4x, which is a premium compared to many peers.

Wall Street remains optimistic. The consensus rating on Apple (AAPL) is Buy, with an average price target of $318.62. Recent analyst moves include Tigress Financial raising its forecast to $375 on May 14, Evercore ISI Group bumping its target to $365 the same day, and Wedbush lifting its target to $400 on May 8.

As of Tuesday's premarket trading, Apple shares were up 0.44% at $310.18, hovering near their 52-week high of $311.39.