Apple’s Stock Takes a Hit Amid Weak iPhone Sales and AI Concerns
The tech giant’s shares plummeted on Tuesday, following a downgrade by Jefferies to “underperform” from “hold” on Monday. The brokerage firm cited flagging iPhone sales and weak demand for Apple’s artificial intelligence (AI) features in newer models as the primary reasons for the downgrade.
Quarterly Revenue Forecasts in Jeopardy
Jefferies analysts expect Apple to miss its first-quarter 2025 revenue guidance of 5% growth, driven by weak iPhone sales and a sluggish consumer electronics market. The firm also reduced its outlook for iPhone 17/18 due to slower AI uptake and commercialization. Furthermore, Jefferies predicts that Apple’s guidance for the March quarter may also disappoint.
JPMorgan Analysts Express Caution
Separately, JPMorgan analysts stuck with an overweight call on Apple but downgraded their price target to $260 from $265. They cited concerns over the strong dollar, limited appetite for Apple products, and “flattish unit sales” given the current AI features. Additionally, they expressed wariness about weak China demand, where Apple will continue to lose market share.
China Demand Woes
Apple’s China iPhones do not feature the recently launched AI capabilities, which has contributed to the company’s struggles in the region. Data from research firm Canalys indicates that Apple lost its position as China’s largest smartphone seller last year. The company’s premium phones also do not benefit from local government subsidies for low-to-mid-tier phones, further exacerbating the issue.
Stock Takes a Tumble
Apple shares fell sharply on Tuesday, down about 3.5% to around $222.40. The stock has lost almost 12% in 2025, sparking concerns among investors. As Apple prepares to report its first-quarter 2025 numbers on Thursday, January 30, all eyes will be on the tech giant’s ability to bounce back from these challenges.
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