Apple Shares in Correction Territory
Apple Inc. shares have struggled to maintain momentum, declining by approximately 13.6% since peaking on Boxing Day. This steep drop has resulted in a $600 billion reduction in market value and cost Apple its position as the world’s most valuable company, with Nvidia now taking the lead. Concerns over muted iPhone demand and the effects of Apple Intelligence AI’s rollout have contributed to the stock’s decline.
Competition in China’s smartphone market has further strained Apple’s position. Huawei and Vivo led the local handset market last year, according to recent data. The International Data Corporation (IDC) reported a 4.1% year-over-year decrease in Apple’s fourth-quarter handset deliveries, totaling 76.9 million units. However, Apple retained its status as the top global smartphone seller with an 18.7% market share, slightly ahead of Samsung’s 18%.
Goldman Sachs analyst Michael Ng noted that Apple’s fiscal first-quarter iPhone shipments aligned with IDC estimates, with iPhone sales rising 1% to $69.7 billion. Still, Ng foresees a 5% year-over-year growth in the average selling price of iPhones, offsetting unit declines.
Focus on Services Revenue
Ng emphasized the potential of Apple’s services segment, predicting double-digit growth. He expects App Store revenue to increase by 15% and sees opportunities for broader adoption of Apple’s services portfolio. Overall, Ng projects Apple’s group revenue for the December quarter to rise nearly 4% to $124.2 billion.
Despite these positive signals, Ng lowered his price target for Apple shares by $6 to $280 while maintaining a “buy” rating. He remains optimistic about the company’s future, citing upcoming innovations like iPhone 17/18 and enhancements to Apple Intelligence. Ng anticipates improved market sentiment midyear, driven by product launches, including new Macs, iPads, and iPhone SE models, as well as updates unveiled at the WWDC 2025 conference.
Market Analysts on Apple’s Prospects
Wedbush analyst Dan Ives also weighed in on Apple’s recent slump, describing the market’s reaction as overblown. Ives reiterated his $325 price target and expressed confidence in Apple Intelligence as a transformative growth opportunity. He predicted that 20% of the global population would eventually use AI through Apple devices, supporting a “bull thesis” for the company’s long-term growth.
Goldman sachs and wedbush analysts agree that Apple’s innovative pipeline and service ecosystem provide a strong foundation for recovery, despite near-term challenges. With its earnings report next week, Apple will face heightened scrutiny as investors assess its ability to navigate competitive pressures and leverage its technological advancements.
