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Will the iPhone 7 Return Apple, Inc. to Growth?

By Daniel Sparks – Mar 2, 2016 at 7:00PM

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Here's the latest speculation on Apple's new flagship iPhone -- and why it is critical for Apple's business.

iPhone 6s. Image source: Apple.

As March 15 approaches, the date of Apple's (AAPL -1.38%) rumored event, many headlines surrounding the company are focused on speculation about the smaller iPhone the company is expected to launch at the event. But it will be the company's refresh of its flagship iPhone lineup, which will likely occur this fall, that will have the most influence on revenue during the next 12 months.

Turning to Apple's iPhone 7
Reportedly aimed to replace the iPhone 5s, which is still selling well for the company, one analyst estimates Apple's rumored smaller iPhone could contribute as much as $5.5 billion in incremental annual revenue during Apple's fiscal 2016. So, it makes sense that investors are focused on this upcoming potential product launch. But this doesn't stop the continued speculation about Apple's rumored iPhone 7 from proliferating.

Rumors surrounding Apple's flagship iPhone have started ramping up recently. A new report from Japanese site Mac Otakara (via MacRumors) released Monday night is particularly interesting, as it seems to support previous rumors and speculation about the device, giving rumors about the iPhone 7 more substance.

Here's a roundup of the latest rumors about iPhone 7.

No 3.5mm headphone jack: As Mac Otakara has previously reported, the site still believes the device will not have a headphone jack. This rumor was also endorsed by 9to5Mac's Mark Gurman, who has a very strong track record with Apple rumors. Instead of using the 3.5mm jack to connect headphones, Gurman and Mac Otakara speculate the device will either require connection via the Lighting connector or wirelessly over Bluetooth.

Nearly as thin as Apple's 6.1mm iPod touch: The iPhone 7 will be about 6.1mm thick -- approximately 1mm thinner than the iPhone 6s or in the same thickness of Apple's iPod touch.

iPod Touch. Image source: Apple.

Not waterproof: Contrary to some speculation that the iPhone 7 would be waterproof and sport new materials for the outer body, Mac Otakara predicts the new device will have the same aluminum material and have the same water resistance as the iPhone 6s.

No dual-lens camera on iPhone 7: Mac Otakara agreed with previous speculation that the iPhone 7 will not sport Apple's rumored new dual-lens camera system, but the Japanese site noted it was unclear whether or not the new camera system will be included in the iPhone 7 Plus. So far, speculation has only suggested the dual-lens would be included on the iPhone 7 Plus -- and not the iPhone 7 -- to help differentiate it from its smaller counterpart.

Other rumors about iPhone 7 circulating include expectations for a flush rear camera, stereo speakers, and upgraded processors.

Apple needs a huge success
Apple management is currently guiding for a year-over-year decline in revenue for its current quarter, blaming economic headwinds and tough comparisons for iPhone sales in the year-ago quarter. While the company's rumored smaller iPhone launch this month could help beef up unit sales enough to prevent further year-over-year declines in the segment -- and possibly even Apple's total revenue -- it will be the iPhone 7 that will likely determine whether the company can return to growth during the next 12 months.

Will the iPhone 7 stand out enough from predecessors to reinvigorate iPhone sales and help the company return to growth?

Daniel Sparks owns shares of Apple. The Motley Fool owns shares of and recommends Apple. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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