Apple (AAPL) AI Stock Analysis

• Market Cap: $3.76T
• Dividend Yield: 0.38%
• Average Volume (3M): 40.22M
• Price to Earnings (P/E): 34.2
• Beta (1Y): 1.09
• Revenue Growth: 6.43%
• EPS Growth: 22.85%
• Country: US
• Employees: 164,000
• Sector: Technology
• Sector Strength: 88
• Industry: Consumer Electronics
• EPS (TTM): 1.85
• Shares Outstanding: 14,697,926,000
• 10 Day Avg. Volume: 47,927,075
• 30 Day Avg. Volume: 40,219,564
• PEG Ratio: 1.51
• Price to Book (P/B): 51.79
• Price to Sales (P/S): 9.18
• P/FCF Ratio: 38.66
• Enterprise Value/Market Cap: 1.04
• Enterprise Value/Revenue: 9.37
• Enterprise Value/Gross Profit: 19.97
• Enterprise Value/Ebitda: 26.86
• 1Y Price Target: $298.49
• Price Target Upside: 20.99% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 32
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 72 Outperform
• Price Target: $301.00 ▲(22.01% Upside)

The score is driven primarily by Apple’s strong financial performance (elite margins and robust free cash flow) and a supportive earnings outlook with record results and solid guidance. Offsetting factors are weak near-term technical momentum and a demanding valuation (high P/E and low yield), with leverage remaining a secondary balance-sheet risk.

Positive Factors

Cash generation and free cash flow

Sustained, very large free cash flow provides durable capacity to fund R&D, capital expenditures, M&A, dividends and buybacks without relying on markets. This high cash conversion also cushions cycles and supports strategic investments in supply chain and services expansion over the medium term.

Elite margins and profitability

Material margin expansion reflects durable pricing power from Apple’s integrated hardware-software ecosystem. High gross and net margins underpin strong returns on capital, enable reinvestment in products and services, and create a structural competitive advantage versus commodity hardware peers.

Growing, recurring Services ecosystem

Rapidly growing, high-margin Services revenue diversifies Apple’s business away from cyclical device sales. Recurring subscriptions, App Store, advertising and cloud services monetize the installed base and make revenue streams stickier, improving predictability and long-term margin stability.

Negative Factors

Elevated leverage on the balance sheet

Meaningful indebtedness and debt above equity reduce financial flexibility over multi-quarter cycles, limiting capacity for countercyclical investment and increasing sensitivity to cash-flow shocks. Higher leverage can amplify downside in slower demand or margin contraction scenarios.

Regulatory and antitrust risk to App Store model

Sustained regulatory scrutiny and fines signal structural risk to Apple’s control over app distribution and data policies. Forced policy changes or mandated app-store opening could reduce service take-rates, weaken advertising revenues, and erode a core competitive advantage tied to platform economics.

iPhone concentration, supply and China exposure

Heavy reliance on iPhone revenue combined with periodic supply constraints and sensitivity to Greater China demand creates a structural source of revenue volatility. Geographic and product concentration can lead to uneven growth and margin pressure when manufacturing or regional demand weakens.

Apple Business Overview & Revenue Model

Company Description

Apple 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 Money

Apple primarily makes money from selling hardware products and from services tied to its installed base of devices. (1) Product revenue: The largest portion of revenue historically comes from iPhone sales, with additional meaningful contributions from Mac and iPad, plus Wearables/Home/Accessories such as Apple Watch, AirPods, and other accessories. Apple sells these products through its own retail and online stores as well as third-party cellular network carriers, wholesalers, retailers, and resellers; channel mix and product upgrade cycles can materially affect results. (2) Services revenue: Apple generates recurring and transaction-based revenue from its Services segment, which includes the App Store (including commissions on paid apps and in-app digital goods sold via its marketplace where applicable), advertising, AppleCare (warranties and support), cloud and digital services such as iCloud, and subscription offerings including Apple Music, Apple TV+, Apple Arcade, Apple Fitness+, Apple News+, and bundled plans like Apple One. (3) Payments and licensing: Apple also earns revenue from payment-related and platform arrangements (e.g., Apple Pay-related ecosystem economics) and from licensing and other agreements associated with its software ecosystem. Overall, Apple’s earnings are supported by its integrated hardware-software-services ecosystem, which helps drive device sales, customer retention, and ongoing services monetization; significant distribution relationships (notably with cellular carriers and major retailers) and the scale of its installed base are key factors influencing revenue.

Apple Financial Statement Overview

Summary

Excellent profitability and cash generation (expanding gross margin to ~47% and very strong free cash flow), supported by strong FY2025 results. The main offset is meaningful leverage (debt above equity) which reduces flexibility if conditions weaken.

Income Statement

Apple shows elite profitability and resilience. Annual revenue rose from $274.5B (2020) to $416.2B (2025) with a strong rebound after a 2023 dip, and 2025 growth accelerated meaningfully. Profitability is a standout: gross margin expanded from ~38% (2020) to ~47% (2025), while net margin remained very strong (~24–27%) and operating profitability stayed consistently high. Main weakness is that revenue growth has been uneven year-to-year, indicating a more mature growth profile with periodic slowdowns.

Balance Sheet

The balance sheet is solid but meaningfully leveraged. Total debt is sizable (~$112.4B in 2025) and leverage is elevated (debt above equity, ~1.5x in 2025 and higher in prior years), which reduces flexibility versus a lower-leverage peer set. Offsetting this, equity increased in 2025 and overall asset base remains large (~$359.2B). Returns on shareholder capital are extremely high, reflecting strong earnings power, but also highlight that leverage and a relatively smaller equity base amplify results (and risk) through the cycle.

Cash Flow

Cash generation is very strong and consistent. Operating cash flow remains above $110B in 2023–2025, and free cash flow is robust (~$98.8B in 2025). Cash conversion is healthy, with free cash flow running at ~0.89–0.92 of net income across the period, suggesting high-quality earnings. The key watch-out is that operating cash flow covers only about two-thirds of total debt (~0.67–0.83 across years), which is fine for a company of this scale but leaves less cushion if cash flow softens.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	416.16B	416.16B	391.04B	383.29B	394.33B	365.82B
Gross Profit	195.20B	195.20B	180.68B	169.15B	170.78B	152.84B
EBITDA	145.13B	144.43B	134.66B	125.82B	133.14B	123.14B
Net Income	112.01B	112.01B	93.74B	97.00B	99.80B	94.68B
Balance Sheet
Total Assets	359.24B	359.24B	364.98B	352.58B	352.75B	351.00B
Cash, Cash Equivalents and Short-Term Investments	54.70B	54.70B	65.17B	61.55B	48.30B	62.64B
Total Debt	112.38B	112.38B	119.06B	123.93B	132.48B	136.52B
Total Liabilities	285.51B	285.51B	308.03B	290.44B	302.08B	287.91B
Stockholders Equity	73.73B	73.73B	56.95B	62.15B	50.67B	63.09B
Cash Flow
Free Cash Flow	98.77B	98.77B	108.81B	99.58B	111.44B	92.95B
Operating Cash Flow	111.48B	111.48B	118.25B	110.54B	122.15B	104.04B
Investing Cash Flow	15.20B	15.20B	2.94B	3.71B	-22.35B	-14.54B
Financing Cash Flow	-120.69B	-120.69B	-121.98B	-108.49B	-110.75B	-93.35B

Apple Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 246.70
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AAPL, the sentiment is Negative. The current price of 246.7 is below the 20-day moving average (MA) of 265.20, below the 50-day MA of 271.03, and above the 200-day MA of 233.87, indicating a neutral trend. The MACD of -5.13 indicates Positive momentum. The RSI at 17.91 is Positive, neither overbought nor oversold. The STOCH value of 12.27 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AAPL.

Apple Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GOOGL	85 Outperform	$3.98T	32.55	35.45%	0.26%	13.55%	34.26%
MSFT	79 Outperform	$3.42T	32.72	32.24%	0.71%	15.59%	15.89%
SONY	75 Outperform	$146.15B	18.43	14.45%	0.41%	-2.47%	6.49%
META	73 Outperform	$1.56T	27.41	32.64%	0.32%	21.27%	6.16%
AAPL	72 Outperform	$3.76T	34.23	171.42%	0.38%	6.43%	22.85%
DELL	65 Neutral	$79.87B	16.08	―	1.45%	10.81%	31.67%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Apple Corporate Events

Apple appoints Ben Borders as principal accounting officer

Apple Inc. announced that its Board of Directors has appointed Ben Borders, 45, as Principal Accounting Officer effective January 1, 2026, as part of a previously disclosed transition plan, succeeding Chris Kondo in the role. Borders, who joined Apple in November 2010 and previously served as Director of Technical Accounting, assumed the position in January 2026, with the company noting that he has no disclosable family relationships or related-party transactions with Apple’s directors or executive officers under applicable regulations.

The most recent analyst rating on (AAPL) stock is a Sell with a $230.00 price target. To see the full list of analyst forecasts on Apple stock, see the AAPL Stock Forecast page.

Apple Announces New General Counsel Appointment

On December 4, 2025, Apple announced that Jennifer Newstead will become the company’s general counsel on March 1, 2026, succeeding Kate Adams, who has held the position since 2017. This leadership transition is significant for Apple’s legal and government affairs strategy, as Newstead will join the executive team and eventually lead Apple’s government affairs organization after Adams’ retirement in late 2026.

The most recent analyst rating on (AAPL) stock is a Buy with a $330.00 price target. To see the full list of analyst forecasts on Apple stock, see the AAPL Stock Forecast page.