Apple’s integration of artificial intelligence (AI) into the iPhone 16 is expected to drive unprecedented demand this holiday season, potentially propelling the tech giant’s market valuation to record highs. Analysts at Wedbush predict a surge in iPhone 16 upgrades, anticipating robust sales leading into Christmas.
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AI-Driven Upgrades to Fuel Record iPhone Sales
Wedbush analysts, led by Dan Ives, suggest that Apple is poised to sell over 240 million iPhones in the 2025 fiscal year. This surge is attributed to AI-driven upgrades and could represent the highest annual iPhone sales in Apple’s history. This projection underscores the transformative potential of Apple’s new AI features, collectively known as Apple Intelligence.
Apple’s Market Cap on Track for $4 Trillion
Apple’s stock price recently closed at $254.49, reflecting a year-to-date surge of 37%. This remarkable growth has elevated Apple’s market capitalization to $3.85 trillion, solidifying its position as the world’s most valuable company, surpassing Nvidia and Microsoft. Wedbush maintains a $300 price target for Apple and projects the company will reach a $4 trillion market cap by early 2025.
Capitalizing on a Vast Untapped Market
Despite a 6% year-over-year increase in iPhone sales in the September quarter, Apple’s annual revenue grew by only 1% in the 2024 fiscal year. While some analysts express concerns about the need for more substantial innovations beyond AI to sustain long-term growth, Wedbush believes these concerns overlook significant opportunities.
With an estimated 2 billion iOS devices and 1.5 billion iPhones in use globally, Wedbush estimates that approximately 300 million iPhones haven’t been upgraded in the past four years. This untapped market, combined with a thriving services business and the immense potential of AI integration within the iOS ecosystem, positions Apple for substantial growth.
Apple Intelligence: A Catalyst for Growth
Wedbush analysts are optimistic about the transformative impact of Apple Intelligence. They believe that the iPhone 16’s success during the upcoming holiday season will serve as a catalyst for a period of renewed growth for Apple over the next 12 to 18 months. The convergence of a large upgrade cycle, a robust services sector, and the integration of AI capabilities creates a powerful synergy that could propel Apple to new heights.
