Apple Earnings Beat Forecasts, Easing Concerns Over iPhone Sales in China
* Ticker Symbols: AAPL, JEF, JPM
* Key Highlights:
* Apple (AAPL) reported first-quarter earnings per share of $2.40 and revenue of $124.3 billion, surpassing analyst expectations.
* China iPhone revenue declined 11% year-over-year, prompting concerns on Wall Street.
* CEO Tim Cook attributed the decline to strategic inventory reductions, not weaker demand.
Analyst Commentary
* JPMorgan (JPM): Raised price target to $270 from $260, citing Cook's comments and potential sales support from Chinese subsidies.
* Citi (C): Maintained Buy rating, noting better-than-feared results and the positive impact of iPhone AI upgrades.
* Raymond James (RJF): Emphasized Apple's strong position in AI due to its ecosystem, hardware capabilities, and privacy focus.
* Morgan Stanley (MS): Contrasted Apple's contained AI ambitions compared to its competitors.
AI Bubble Impact
* Apple's prudent approach to data center infrastructure spending has been highlighted amid concerns over AI capex.
* DeepSeek's Chinese AI model has raised hopes for cheaper, more powerful on-device AI applications.
Skeptic's View
* Jefferies (JEF): Downgraded Apple to Underperform, expressing skepticism about the attractiveness of smartphone AI services and overestimated expectations for iPhone upgrade cycles.