Apple’s first foldable iPhone has run into a problem the company would have preferred to avoid. Within days of going on sale, the $1,999 device began attracting complaints from customers who say its inner display cracked after only hours or days of use, raising fresh questions about the engineering behind Apple’s long-awaited entry into the foldable smartphone market.

According to Bloomberg, verified complaints from more than half a dozen customers, who supplied photographs of damaged devices or evidence of their exchanges with Apple support. Several described hearing a crunching sound while unfolding the phone, followed by cracks along the central crease. Others reported white patches, bright lines and display malfunctions that rendered the inner screen unusable.

The reports emerged over the weekend on Reddit and other social media platforms, shortly after the iPhone Duo went on sale globally on October 23. Similar complaints were reported by users in the United States, Australia and India; with an Australian customer’s account of the screen failing within six hours of purchase, although it could not independently verify that particular claim.

Apple on its part has acknowledged the problem, saying it was aware of an issue affecting the inner display on a “small number” of iPhone Duo units.

The company advised affected customers to contact AppleCare for replacements, but did not disclose how many devices were affected or explain what had caused the failures.

The repair specialist iFixit subsequently examined the phone’s internal construction, using teardown footage and CT scans to investigate the reported damage. Its analysis suggested that a central support bar in the hinge mechanism might not move clear of the display sufficiently when the phone folds, potentially creating a concentrated pressure point. The explanation remains a hypothesis; Apple has not confirmed it as the cause.

The timing is particularly notable because Apple marketed the Duo around its precision-engineered hinge and durable foldable design.

The handset starts at ₹2,99,900 in India, placing it firmly in the premium segment. An inner-screen repair outside warranty has been reported to cost $999, roughly half the phone’s starting price in the United States.

The complaints have not established how widespread the problem is. Apple says only a small number of units are affected, and early reports are insufficient to determine a failure rate. Nevertheless, the issue has arrived at a sensitive moment for the company, which is making its first entry into a category that competitors have been developing for years.

The Complaints Extend Beyond The Foldable

The display complaints are not the only recent issue involving Apple products and services. The company has also faced scrutiny over software-related repair costs in India, delays to promised artificial intelligence features and the commercial performance of its Vision Pro headset.

In September, it was reported that India’s Central Consumer Protection Authority had escalated an investigation into Apple’s software warranty terms following complaints that the iOS 18 update caused display problems, coloured lines on screens and microphone malfunctions. Consumers alleged that they were subsequently required to pay for repairs despite the problems being linked to a software update.

Apple disputed the allegations, telling investigators that it had found no systemic issue with iOS 18 in India. It also argued that its software warranty exclusions were consistent with industry practice and that the relevant terms were disclosed to users. The company said the case was based on 75 complaints and that only around 11% of iPhones were still running iOS 18 by June 2026. 

Artificial intelligence has generated another round of criticism. In May, Apple agreed to pay $250 million to settle a US class-action lawsuit concerning the marketing of Apple Intelligence and promised upgrades to Siri. The lawsuit alleged that Apple’s advertising gave consumers the impression that advanced AI capabilities would be available sooner than they actually were.

The iPhone maker did not admit wrongdoing in the settlement. Apple said it had released numerous other AI features and described the agreement as a way to resolve claims concerning the availability of two additional features. Nevertheless, the case has added to scrutiny of the gap between Apple’s AI announcements and the delivery of the capabilities it promoted.

The Vision Pro headset has also struggled to establish itself as a mainstream product. Reports in 2026 have pointed to weak demand, reduced production and limited appeal beyond a relatively small audience, with the device’s high price, weight and limited application ecosystem cited as barriers to adoption. 

The Growing Criticism That Apple Has Lost Its Innovation Edge

The criticism of Apple is no longer confined to a delayed AI feature or a troubled product launch. A broader question is emerging over whether the company that once reshaped consumer technology has become more adept at expanding its existing business than creating the next transformative product.

PayPal co-founder and investor Peter Thiel made that argument in an interview with author Walter Isaacson on The Builders podcast, released on October 22. Thiel said Apple had done “nothing new” since Steve Jobs died in 2011, arguing that the company had concentrated on scaling its business, strengthening its brand and building out the iPhone ecosystem rather than delivering comparable breakthroughs. He nevertheless acknowledged that Apple remained a successful, well-run business.

A more detailed examination showed a widening innovation gap as Apple prepared for a leadership transition. The delayed AI-powered Siri, the departure of senior AI executives, the cancellation of the Apple Car project and the limited commercial traction of the Vision Pro. Further, whether Apple’s reliance on incremental iPhone upgrades and its lucrative Services business could sustain growth as replacement cycles lengthen and competition intensifies.

The criticism is not that Apple has stopped producing successful products. Rather, it concerns the difference between improving established products and introducing technologies that change consumer expectations.

Apple’s late arrival in foldables and its difficulties delivering advanced AI capabilities have brought that distinction into sharper focus.

The Other Side of the Story – Apple Remains a Commercial Powerhouse

Yet any suggestion that Apple is already losing its commercial position also runs into a substantial body of counter-evidence. On October 22, Apple shares closed at a record $348.22, giving the company a market capitalisation of approximately $5.082 trillion. That placed it just $42 billion behind Nvidia, which was valued at $5.124 trillion at the time. Apple’s shares had gained 28.44% year to date.

The performance also coincided with the launch of the $1,999 iPhone Duo with reports that online orders sold out within minutes, with delivery estimates for many configurations extending to January 2027. Strong initial demand suggests that Apple’s brand and product appeal remain powerful, although long delivery estimates alone cannot establish the scale of underlying demand.

The iPhone 18 Pro series has also shown strength in China. According to Counterpoint Research, sales rose 12% year on year during the first week of availability, allowing Apple to capture 33% of smartphone sales in China during the week of September 14–20. The wider Chinese smartphone market, however, contracted 17% over the same period, making the launch performance particularly notable.

These figures complicate the argument that Apple has lost its edge. Its market valuation, initial foldable demand and Pro-series sales demonstrate continuing commercial strength.

The Foldable Problem Is About More Than a Broken Screen

Apple’s entry into the foldable smartphone market was supposed to mark a major new chapter for the iPhone. Instead, the early reports of display failures have put the spotlight on an uncomfortable question: after years of watching competitors develop the technology, has Apple delivered a product that sufficiently advances the category to justify the wait?

Samsung launched its original Galaxy Fold in 2019, several years before Apple’s first foldable arrived. The intervening period gave manufacturers time to refine hinge mechanisms, improve display durability, address dust-related vulnerabilities and experiment with different form factors. Huawei, Motorola and Google also entered the market, giving consumers alternatives across price points and designs.

Apple, meanwhile, had the advantage of observing the category mature before committing to its own version.

That makes the expectations around the iPhone Duo different from those surrounding the first generation of foldables. Apple was not inventing the category; it was entering an established one with the promise of applying its own design, engineering and software expertise.

The company’s proposition rests on the familiar argument that arriving later allows it to deliver a more polished product. Its launch materials emphasised a thin design, a sophisticated hinge and a large inner display. The device also carries an IP68 rating, a notable specification in a category where water and dust resistance have historically presented engineering challenges.

But the early complaints raise questions about whether those advantages will translate into reliability over time. The number of reported failures is still too small to establish a defect rate, and Apple has offered replacements to affected customers. It would therefore be premature to conclude that the design itself is fundamentally flawed.

The larger issue is what Apple must demonstrate next. A premium price and a familiar logo cannot, by themselves, establish that a late entrant has produced a superior device. Apple must show that its approach to durability, software integration and everyday usability offers a meaningful advantage over products that have already gone through several generations of refinement.

AI and the Problem of Playing Catch-Up

The foldable is not the first area in which Apple has faced criticism for arriving late. Artificial intelligence has become a more consequential test of the company’s ability to anticipate technological change, and its experience with Siri illustrates how difficult it can be to turn a product announcement into a working consumer experience.

Apple introduced Apple Intelligence in 2024, promising a more capable Siri that could understand personal context, work across applications and perform tasks on a user’s behalf. The announcement raised expectations that the assistant would become a central part of the iPhone experience. But the company subsequently delayed key capabilities, prompting criticism from customers, developers and investors.

Reports described internal disagreements over Siri’s technical direction, repeated changes in development strategy and tensions between teams – these problems contributed to delays in delivering the promised upgrades. 

Meanwhile, competitors have continued developing conversational AI, coding assistants and systems capable of carrying out multi-step tasks. OpenAI, Google and Anthropic have expanded beyond simple question-and-answer interactions, pushing towards tools that can search information, work with files and use applications to complete tasks.

Apple’s challenge is not simply to match the latest chatbot. Its advantage has traditionally been the integration of hardware and software, and the company has argued that privacy, on-device processing and access to personal information can make its AI tools more useful in everyday life. 

The delays have also raised questions about the gap between Apple’s marketing and its delivery. In May 2026, the company agreed to a $250 million settlement in a US class-action lawsuit over allegations concerning the promotion of delayed Siri features. Apple did not admit wrongdoing, but the settlement added to scrutiny of the promises made around Apple Intelligence.

The competitive implications extend beyond Siri. As AI becomes a more important part of how people search, communicate, create content and interact with devices, the assistant could influence which ecosystem consumers choose to use. If rival products become more capable while Apple’s features remain delayed or limited, the iPhone’s established position will not automatically guarantee leadership in the next phase of personal computing.

Apple still has considerable advantages, including its installed base, custom silicon, distribution and control over its operating systems. Its privacy-focused approach may also appeal to users wary of handing personal information to external AI services. But those strengths cannot remove the need to deliver.

The question is whether Apple can convert its resources and ecosystem into an AI experience that people consider genuinely better, rather than merely more tightly integrated with the devices they already own. 

The Upgrade Cycle And The Consumer Ecosystem That Keeps Apple On Top

Apple’s greatest strength may also be the reason it can afford to move more slowly than its competitors. The company has built an ecosystem in which the iPhone is no longer simply a smartphone. It is the centre of a network connecting the Apple Watch, AirPods, Mac, iPad, iCloud, payment services and an expanding range of subscriptions. The more devices and services customers use, the more convenient it becomes to remain within Apple’s system.

This integration is a genuine competitive advantage. A customer who owns an iPhone, MacBook and Apple Watch can move between devices, synchronise information and access services with relatively little friction. Switching to another smartphone brand may mean giving up some of that convenience, learning a different system or replacing complementary hardware. The resulting loyalty helps Apple retain customers even when competitors introduce features first.

A SellCell survey published in April 2026 illustrates the strength of that relationship. Among 5,000 US smartphone users surveyed, 96.4% of iPhone users said they intended to remain with Apple for their next upgrade, compared with 86.4% of Android users who intended to remain with their existing platform. The survey also found that 17.4% of iPhone users cited their investment in Apple’s ecosystem as a reason for staying.

Those numbers are impressive, but they also raise a question about what sustains Apple’s dominance. Loyalty can reflect superior products, reliable software and a seamless user experience. It can also reflect the time, money and inconvenience involved in switching platforms. The survey does not establish which factor is decisive, but it shows why Apple’s installed base remains such a powerful commercial asset.

The more immediate challenge is the upgrade cycle itself. Smartphones have matured, and many users no longer see enough difference between successive generations to justify replacing a perfectly functional device. UBS research published in July 2026, based on a survey of more than 7,500 smartphone users across five countries, found that the share of respondents who said Apple Intelligence would make them upgrade sooner had fallen to approximately 24%. Around 31% said the features had no impact on their purchasing decision.

That is a significant finding for a company whose business depends on persuading existing customers to buy new hardware. AI was expected to provide a fresh reason to upgrade, but the survey suggests that Apple’s current AI offering has not yet become the decisive purchasing trigger its marketing might have hoped for.

Apple has other ways to sustain growth, including Services revenue, wearables, trade-ins and financing arrangements that make new devices easier to purchase. But there is a difference between making an upgrade financially convenient and giving a customer a compelling reason to want one.

The central question is whether Apple can continue relying on the strength of its ecosystem while the technological advantages of individual devices become less obvious. If competitors begin delivering substantially better AI assistants, more capable hardware or new ways to interact with technology, Apple’s integration advantage may help it retain customers for a time. It cannot guarantee that the next generation will remain equally attractive.

A $5 Trillion Company With Something To Prove

By conventional financial measures, Apple has little to suggest that it is a company in decline. Its valuation, revenue and profitability remain extraordinary, even as critics question whether its products are as transformative as they once were.

On October 23 that Apple shares had closed at a record $348.22, giving the company a market capitalisation of approximately $5.082 trillion. That placed it just $42 billion below Nvidia’s $5.124 trillion valuation at the time. The figures illustrate the extraordinary confidence investors continued to place in Apple’s business.

The company’s own financial results reinforce the point. Apple reported revenue of $109.4 billion for its fiscal third quarter ended June 27, 2026, up 16% year on year. iPhone, Mac and Services revenue each reached a June-quarter record, while the installed base of active devices reached an all-time high across major product categories.

These results matter because they demonstrate that criticism of Apple’s innovation strategy has not translated into an obvious collapse in demand or financial performance. Its customer base remains large, its ecosystem generates recurring revenue, and its devices continue to command premium prices.

But market capitalisation and technological leadership are not interchangeable. Investors value Apple for its earnings, cash generation, margins, services, installed base and expectations of future growth. A company can perform exceptionally well financially while facing questions about whether it is leading the next wave of technological change.

That distinction becomes particularly important in AI. Apple has not attempted to compete with Nvidia by building a comparable business selling AI accelerators, nor does it need to replicate every element of Google’s or OpenAI’s strategy.

Its opportunity is to make AI valuable through devices and services already used by hundreds of millions of people. If it succeeds, it could capture substantial value without matching the infrastructure spending of its rivals.

The risk is that the same strategy could become a source of complacency. If Apple’s ecosystem continues generating strong returns, the company may have less immediate commercial pressure to make radical changes to its products. Yet the technologies that determine consumer expectations can evolve faster than the replacement cycles of smartphones. A company that waits until a new category is commercially established before entering it may find that competitors have already shaped the market.

Apple’s financial strength therefore cuts both ways. It gives the company the resources, customer reach and time to correct mistakes. It also raises the expectations attached to every major launch.

A $1,999 foldable that encounters early display problems, or an AI assistant whose promised capabilities arrive late, attracts attention precisely because Apple has built its reputation on getting the details right.

Therefore the question is not whether Apple remains a commercial powerhouse. The numbers show that it does. The question is whether that power will continue to be accompanied by the product leadership that originally made its ecosystem so desirable.

Can Apple Afford To Keep Arriving Late?

Apple has the financial resources, customer base and global reach to recover from product setbacks. What it cannot afford indefinitely is to rely on those advantages as a substitute for delivering products that meet the expectations it has created.

The foldable iPhone presents an immediate test. Before launch, Apple CEO John Ternus and marketing chief Greg Joswiak argued that the company had waited until its own standards for quality, durability and design could be met.

They criticised existing foldables for their materials and form factors, positioning Apple’s design as a more considered alternative. The early reports of display failures have therefore placed those assurances under scrutiny.

The response will matter as much as the initial problem. Apple has acknowledged the affected units and offered replacements, while engineers have reportedly begun investigating the failures.

A prompt response, transparent communication and evidence that the underlying issue has been resolved would help contain the damage. If further failures emerge, however, the company will need to explain why a device developed over years has encountered a problem so soon after launch.

The longer-term challenge is AI. Apple has the resources to invest in its own models, develop partnerships and integrate AI into devices already used by hundreds of millions of people. But it must translate those advantages into capabilities customers can actually use. Announcements and demonstrations are not substitutes for products that arrive on time and perform reliably.

The company also needs to demonstrate that its next generation of devices offers reasons to upgrade beyond incremental improvements. Its ecosystem gives it a substantial advantage, but customers will continue to compare what Apple offers with what competing manufacturers deliver. Loyalty is powerful; it is not an unlimited licence to disappoint.

Apple’s late entry into foldables could still prove commercially successful. Its AI strategy could also mature into a compelling alternative to rival platforms. Neither outcome is guaranteed, and neither can be judged solely by the first weeks of a product launch.

The question is whether Apple can convert its enormous financial and technological resources into the next generation of products that people genuinely want, rather than relying on the strength of the products and ecosystem it has already built.

The Last Bit, The Pedestal Is Not the Same As The Product

Apple remains one of the world’s most valuable companies, with record financial results, a formidable installed base and an ecosystem that competitors have struggled to replicate. Those strengths make claims of an imminent collapse difficult to sustain.

But commercial dominance and technological leadership are different things. The company that once persuaded consumers to rethink what a phone, music player or personal computer could be is now facing criticism over delayed AI capabilities, the pace of product innovation and the execution of its first foldable.

What they do is sharpen a question that has been building for years: is Apple still defining the next phase of consumer technology, or increasingly entering markets after others have established them?

Its record valuation shows that investors continue to believe in the business. The harder test is whether the products that follow can justify that confidence.

Apple has not fallen off its pedestal simply because a new product has encountered problems. But neither its market capitalisation nor its loyal customer base can guarantee that it will remain there. The company must keep earning that position – through innovation, execution and products that give customers a compelling reason to stay.