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Apple (AAPL)
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Apple (AAPL) AI Stock Analysis

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AAPL

Apple

(NASDAQ:AAPL)

Rating:80Outperform
Price Target:
$266.00
â–²(15.41% Upside)
Apple's strong financial performance and positive earnings call are the most significant factors driving the score. The company's robust profitability, cash flow, and strategic focus on AI and global expansion support a positive outlook. However, high valuation metrics and technical indicators suggesting overbought conditions temper the overall score.
Positive Factors
Carrier Promotions
Continued carrier competition is expected to drive device-related promotions, potentially boosting sales.
Product Launch
Apple will host a special event when it is expected to announce new products including the iPhone 17 series and an updated Apple Watch portfolio.
Revenue Growth
There is potential for a price increase to the iPhone 17 Pro, which could positively impact revenue.
Negative Factors
Consumer Expectations
Investor expectations for the benefit from a thin phone are more tempered, suggesting limited excitement about the upcoming iPhone 17 Air.
Legal Challenges
An Australian federal court recently ruled in favor of Epic Games in the AAPL vs. EPIC case, deeming that Apple and Google engaged in anti-competitive conduct related to their respective smartphone app stores.
Market Sentiment
Expectations remain tempered for next iPhone cycle.

Apple (AAPL) vs. SPDR S&P 500 ETF (SPY)

Apple Business Overview & Revenue Model

Company DescriptionApple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories worldwide. The company offers iPhone, a line of smartphones; Mac, a line of personal computers; iPad, a line of multi-purpose tablets; and wearables, home, and accessories comprising AirPods, Apple TV, Apple Watch, Beats products, and HomePod. It also provides AppleCare support and cloud services; and operates various platforms, including the App Store that allow customers to discover and download applications and digital content, such as books, music, video, games, and podcasts, as well as advertising services include third-party licensing arrangements and its own advertising platforms. In addition, the company offers various subscription-based services, such as Apple Arcade, a game subscription service; Apple Fitness+, a personalized fitness service; Apple Music, which offers users a curated listening experience with on-demand radio stations; Apple News+, a subscription news and magazine service; Apple TV+, which offers exclusive original content; Apple Card, a co-branded credit card; and Apple Pay, a cashless payment service, as well as licenses its intellectual property. The company serves consumers, and small and mid-sized businesses; and the education, enterprise, and government markets. It distributes third-party applications for its products through the App Store. The company also sells its products through its retail and online stores, and direct sales force; and third-party cellular network carriers, wholesalers, retailers, and resellers. Apple Inc. was founded in 1976 and is headquartered in Cupertino, California.
How the Company Makes MoneyApple generates revenue through multiple streams, primarily from the sale of its hardware products, which include the iPhone, iPad, Mac, and various accessories. The iPhone remains the largest contributor to the company's revenue, accounting for a significant portion of total sales. In addition to hardware, Apple earns substantial income from its services segment, which encompasses digital content sales, cloud services, and subscriptions. The App Store, Apple Music, and Apple TV+ are key components of this segment. Furthermore, Apple benefits from partnerships with telecommunications companies and app developers, which contribute to its ecosystem and revenue generation. The company's focus on premium pricing and brand loyalty also plays a critical role in its financial success.

Apple Key Performance Indicators (KPIs)

Any
Any
Global Active Devices
Global Active Devices
Tracks the number of devices actively in use worldwide, reflecting customer adoption, brand stickiness, and potential for recurring service revenue.
Chart InsightsApple's global active devices have grown steadily, reaching 2.35 billion, reflecting strong ecosystem engagement. The earnings call highlights record revenue and growth in services and emerging markets, underscoring Apple's strategic focus on expanding its installed base. Despite challenges in China and a decline in wearables revenue, the robust increase in active devices suggests sustained customer loyalty and potential for future revenue growth, particularly in services. The company's anticipation of continued growth in the March quarter, despite foreign exchange headwinds, indicates confidence in its diversified product and service offerings.
Data provided by:Main Street Data

Apple Earnings Call Summary

Earnings Call Date:Jul 31, 2025
(Q3-2025)
|
% Change Since: |
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Positive
The earnings call revealed strong performance across Apple's major product lines, with record revenues and growth in iPhone, Mac, and Services. However, challenges were noted in the iPad and Wearables segments, alongside significant tariff costs. Overall, the positive aspects and strategic advancements in AI and global expansion overshadow the lowlights.
Q3-2025 Updates
Positive Updates
Record-Breaking Revenue
Apple reported a June quarter revenue record of $94 billion, up 10% year-over-year.
Strong EPS Growth
Earnings per share (EPS) set a June quarter record of $1.57, up 12% from the previous year.
iPhone Revenue Growth
iPhone revenue was $44.6 billion, up 13% year-over-year, driven by the success of the iPhone 16 family.
Mac Revenue Increase
Mac revenue reached $8 billion, up 15% year-over-year, largely driven by the M4 MacBook Air.
Services Revenue Record
Services revenue was $27.4 billion, up 13% year-over-year, marking an all-time record.
AI and Innovation
Significant advancements in AI were announced, including new features and capabilities across Apple devices.
Global Expansion
Growth was noted in every geographic segment, with records in over two dozen countries and regions.
Negative Updates
iPad Revenue Decline
iPad revenue was $6.6 billion, down 8% year-over-year, attributed to a difficult comparison with the previous year's launches.
Wearables, Home and Accessories Revenue Decline
Revenue for this segment was $7.4 billion, down 9% year-over-year, due in part to a challenging comparison in accessories.
Tariff-Related Costs
The company incurred $800 million of tariff-related costs for the June quarter, with an expected increase to $1.1 billion for the September quarter.
Company Guidance
In the Apple Q3 Fiscal Year 2025 Earnings Conference Call, Apple reported a June quarter revenue record of $94 billion, marking a 10% year-over-year increase. This growth was driven by double-digit increases in iPhone, Mac, and Services revenue. The iPhone segment alone generated $44.6 billion, up 13%, with significant growth in emerging markets. Mac revenue reached $8 billion, up 15%, while Services revenue hit an all-time high of $27.4 billion, also up 13%. Apple's gross margin was 46.5%, and the company reported a net income of $23.4 billion, with diluted earnings per share of $1.57, up 12% from the previous year. Despite incurring $800 million in tariff-related costs, Apple continued its strong financial performance and announced an expected $1.1 billion impact from tariffs in the upcoming quarter. The company also highlighted significant investments in AI and continued expansion in emerging markets, with a focus on integrating AI features across its platforms.

Apple Financial Statement Overview

Summary
Apple's financial statements indicate strong profitability and cash generation capabilities, with a high net profit margin and robust operational efficiency. However, the high debt-to-equity ratio suggests reliance on debt financing, which could pose risks in economic downturns.
Income Statement
85
Very Positive
Apple's income statement shows strong profitability with a TTM Gross Profit Margin of 46.68% and Net Profit Margin of 24.30%, indicating effective cost management and pricing strategy. The Revenue Growth Rate of 4.50% over the previous year is modest but consistent, reflecting steady demand for Apple products. The EBIT Margin of 31.87% and EBITDA Margin of 33.94% underscore robust operational efficiency.
Balance Sheet
78
Positive
Apple maintains a solid balance sheet with a Debt-to-Equity Ratio of 1.55, which is relatively high but manageable given its strong earnings. The Return on Equity (ROE) stands at 150.87%, showcasing exceptional shareholder value creation. However, the Equity Ratio of 19.86% suggests a reliance on debt financing, which could pose risks in economic downturns.
Cash Flow
82
Very Positive
Apple's cash flow is robust with a Free Cash Flow of $105.66 billion, reflecting a slight decline from the prior year but still very strong. The Operating Cash Flow to Net Income Ratio of 1.09 indicates healthy cash generation relative to net earnings, while the Free Cash Flow to Net Income Ratio of 1.06 confirms efficient capital expenditure management.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue408.63B391.04B383.29B394.33B365.82B274.51B
Gross Profit190.74B180.68B169.15B170.78B152.84B104.96B
EBITDA141.70B134.66B125.82B133.14B123.14B81.02B
Net Income99.28B93.74B97.00B99.80B94.68B57.41B
Balance Sheet
Total Assets331.50B364.98B352.58B352.75B351.00B323.89B
Cash, Cash Equivalents and Short-Term Investments55.37B65.17B61.55B48.30B62.64B90.94B
Total Debt101.70B119.06B123.93B132.48B136.52B122.28B
Total Liabilities265.67B308.03B290.44B302.08B287.91B258.55B
Stockholders Equity65.83B56.95B62.15B50.67B63.09B65.34B
Cash Flow
Free Cash Flow96.18B108.81B99.58B111.44B92.95B73.36B
Operating Cash Flow108.56B118.25B110.54B122.15B104.04B80.67B
Investing Cash Flow19.23B2.94B3.71B-22.35B-14.54B-4.29B
Financing Cash Flow-118.16B-121.98B-108.49B-110.75B-93.35B-86.82B

Apple Technical Analysis

Technical Analysis Sentiment
Positive
Last Price230.49
Price Trends
50DMA
214.67
Positive
100DMA
207.90
Positive
200DMA
220.64
Positive
Market Momentum
MACD
4.88
Positive
RSI
66.92
Neutral
STOCH
67.95
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AAPL, the sentiment is Positive. The current price of 230.49 is above the 20-day moving average (MA) of 224.20, above the 50-day MA of 214.67, and above the 200-day MA of 220.64, indicating a bullish trend. The MACD of 4.88 indicates Positive momentum. The RSI at 66.92 is Neutral, neither overbought nor oversold. The STOCH value of 67.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AAPL.

Apple Risk Analysis

Apple disclosed 28 risk factors in its most recent earnings report. Apple reported the most risks in the "Ability to Sell" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Apple Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
84
Outperform
$3.73T36.8033.28%0.66%14.93%15.50%
84
Outperform
$2.51T22.2134.83%0.38%13.19%34.51%
80
Outperform
$3.40T34.53149.81%0.44%5.97%0.15%
78
Outperform
$169.48B22.1514.70%0.43%-4.41%18.04%
73
Outperform
$25.37B10.6084.33%4.03%3.11%-3.54%
70
Outperform
$226.01B38.8422.73%2.74%2.69%-31.73%
67
Neutral
$88.92B20.89-179.12%1.46%7.68%27.73%
61
Neutral
$35.62B7.50-10.94%1.87%8.86%-10.27%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AAPL
Apple
230.49
1.77
0.77%
GOOGL
Alphabet Class A
211.64
50.64
31.45%
HPQ
HP
28.35
-5.78
-16.94%
IBM
International Business Machines
245.73
52.30
27.04%
MSFT
Microsoft
509.64
99.60
24.29%
SONY
Sony Group
28.00
8.70
45.08%
DELL
Dell Technologies
134.05
25.29
23.25%

Apple Corporate Events

Executive/Board Changes
Apple Appoints Sabih Khan as New COO
Neutral
Jul 25, 2025

Apple Inc. announced that Sabih Khan has been appointed as the new Chief Operating Officer, effective July 25, 2025, succeeding Jeff Williams. Khan, who has been with Apple since 1995, previously held senior positions in operations and product operations, and his appointment is part of a planned transition by the company.

Executive/Board Changes
Apple Announces Leadership Transition with New COO
Neutral
Jul 9, 2025

On July 8, 2025, Apple Inc. announced a leadership transition as Jeff Williams will step down as Chief Operating Officer later this month, with Sabih Khan, the Senior Vice President of Operations, taking over the role. This change is part of a long-planned succession, with Williams continuing to oversee Apple’s design team and health initiatives until his retirement later in the year, after which the design team will report directly to CEO Tim Cook.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 19, 2025