Apple stock (AAPL) reached a record high of $255.65 on December 23rd, closing at $255.27, showcasing a remarkable 32.6% year-to-date growth, surpassing both the S&P 500 and Nasdaq Composite indexes. This surge is attributed to strong holiday sales and excitement surrounding the company’s new AI technology, Apple Intelligence.
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Apple’s recent success is fueled by several factors, including the release of iOS 18.2, a major software update featuring advanced AI capabilities. These features, exclusive to iPhone 16 and iPhone 15 Pro models, include customizable emojis and ChatGPT integration within Siri and Writing Tools. Apple hopes these innovations will drive a wave of handset upgrades.
Apple Intelligence Poised to Drive Growth in Key Markets
Wedbush analyst Daniel Ives, in a December 22nd research note, indicated that iPhone 16 demand since its September launch has met or slightly exceeded expectations. He predicts a “strong holiday season ahead” due to robust iPhone 16 upgrade trends. Ives further highlights the global potential of Apple Intelligence, noting its pending rollout in China and other countries, potentially in partnership with a Chinese tech company, by April 2025. This expansion is expected to significantly catalyze growth in these key regions.
Wedbush maintains an outperform rating for Apple stock with a $300 price target. Recent discussions between Apple and Chinese tech giants Tencent (TCEHY) and ByteDance regarding the integration of their AI models into iPhones sold in China further underscore the company’s strategic focus on AI and global market expansion.
Apple’s Long-Term AI Strategy: A Foundation for Future Growth
Wedbush analysts argue that those bearish on Apple have underestimated three crucial elements: the company’s vast installed base of 2 billion iOS devices, including approximately 300 million iPhones ripe for upgrades; a $2 trillion services business effectively monetizing its customer base; and Apple’s emerging dominance in consumer AI, with a projected 20% of the global population anticipated to engage with AI on Apple devices. This long-term vision positions Apple at the forefront of the AI revolution.
Apple’s recent emergence from an iPhone sales slump during the summer quarter further solidifies its strong market position. The company expects “low-to-mid-single-digit” percent sales growth for the December quarter.
Apple Predicted to Reach $4 Trillion Market Cap
Wedbush’s bullish outlook extends to a prediction of Apple achieving a $4 trillion market capitalization in early 2025. This projection is based on the company’s strong financial performance, its strategic focus on AI, and the anticipated continued growth in demand for its products and services. The combination of these factors paints a picture of sustained growth and market leadership for Apple in the coming years. This projection underscores the transformative potential of Apple Intelligence and its role in shaping the future of the company.
