(Bloomberg) -- Apple Inc. shares fell Monday after a closely followed analyst warned that demand for the firm’s new iPhone 16 Pro model has been lower than expected.

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Pre-order sales, which began Friday for the phone, have tallied an estimated 37 million units, TF International Securities analyst Ming-Chi Kuo wrote in a report. That’s down almost 13% from last year’s iPhone 15 launch and is a result of weaker-than-anticipated interest in the Pro model of the iPhone 16, says Kuo.

“One of the key factors for the lower-than-expected demand for the iPhone 16 Pro series is that the major selling point, Apple Intelligence, is not available at launch alongside the iPhone 16 release,” Kuo said in the report.

After a weak start to the year, shares in the company rallied the past four months as investors bet Apple’s AI features would boost sales of its latest line of iPhones. They slumped about 3% to start Monday trading, paring their gain this year to roughly 12%, trailing the 15% advance in the Nasdaq 100 Index.

Analysts were largely underwhelmed after the company’s launch event last week as most of the hardware announcements were leaked beforehand. Looking past the launch event, Morgan Stanley’s Erik Woodring noted last week that attention will turn to “early iPhone 16 pre-order and lead time data that we will start to collect this Friday.”

The demand weakness for the iPhone 16 is not a good sign, “particularly since we’re heading into the holiday selling season soon,” said Matthew Maley, chief market strategist at Miller Tabak + Co. The risk of a “meaningful decline” in the shares has “risen in a material way.”

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