Apple results, guidance praised on Wall Street amid AI, iPhone hope

Apple’s (NASDAQ:AAPL) quarterly results and early outlook for the coming quarter received praise on Wall Street, with several firms pointing out the potential for the next iPhone and the tech giant’s artificial intelligence strategy.

Shares were down 1.5% in premarket trading.

“Apple Intelligence rollout has already begun with developers who will significantly enhance app capabilities as the company staggers the launch of its new AI feature along with its OpenAI partnership which Apple expects ChatGPT and all other features to be integrated into the iPhone and other devices by the end of the year,” Wedbush Securities analyst Dan Ives wrote in an investor note. “We believe AI technology being introduced into the Apple ecosystem will bring monetization opportunities on both the services as well as iPhone/hardware front and adds $30 to $40 per share.”

Ives reiterated his Outperform rating on Apple and upped his price target to $285 from $275 following the results.

Others shared that enthusiasm, including Bank of America analyst Wamsi Mohan, who said “the best is yet to come.”

“Results from Apple indicate improving trends across the portfolio where growth accelerated in iPhone, iPad and wearables and across regions,” Mohan wrote in a note to clients. “Implied [revenue] guidance of $94bn will end up being conservative, especially around Services and iPhones (No upside from new models embedded in guidance). We further see the potential for significant acceleration of units in Dec [quarter] and overall in F25 with the rollout of Apple Intelligence.”

Mohan reiterated his Buy rating and kept his $256 price target on Apple. However, he said there is the potential for estimates to be revised higher, citing “multi-year iPhone upgrade cycle, tailwinds to gross margins and strong cash flows.”

Citi analyst Atif Malik also raised his price target, moving to $255 from $210 and said that he is “encouraged” by the early developer feedback on the beta Apple Intelligence features for iOS 18 that launched this week as well as Apple’s management team that AI will “drive a compelling iPhone upgrade cycle.”

“Though early, our discussions with developers indicate positive response to AI features, particularly notification summary and reduced interruption focus,” Malik wrote. He reiterated his Buy rating on Apple and said he expects an even larger refresh for the iPhone 17 as he believes it may “take time for consumers to see the value of an AI smartphone as well as for developers to develop apps.”