Apple Inc (NASDAQ:AAPL) stock fell 0.22% (As on June 24, 11:17:41 AM UTC-4, Source: Google Finance) after the company is upgraded from Hold to Buy by Juxtaposed Ideas. The analyst cites improved margin of safety after AAPL’s recent price correction, with the stock now trading closer to fair value despite ongoing challenges from tariffs and slowing iPhone sales in China. “Despite the maturing growth profile and impacted cash flow/balance sheet, it goes without saying that the stock may not be suitable for those seeking high growth cadence, as it transitions to a mature blue-chip company. As a result of the improved margin of safety, we are cautiously upgrading the AAPL stock as a Buy.”
Moreover, the management project revenue growth to continue in the ongoing quarter, despite the iPhone struggles in its core Chinese market and a stronger currency. For the March quarter, which will be Apple’s second for the financial year 2025, the iPhone manufacturer expects low-to-mid-single-digit growth on an annual basis. It also guided for its services division to grow in low double-digits from last year. This will be offset by a stronger US Dollar, that will impose a 2.5% drag on overall sales. Revenue from China plunged 11 per cent to $18.5 billion in the fiscal first quarter, which ended Dec. 28, Apple said earlier. Analysts had anticipated a gain to $21.6 billion. Sales of the iPhone, meanwhile, dropped less than 1 per cent to $69.1 billion. Wall Street projected $71 billion. The results renewed concerns about China, one of Apple’s biggest markets, where it’s struggled to fend off competition from local brands. Apple is planning a larger iPhone refresh this year, including a replacement for its low-end SE model in the coming months and a thinner iPhone in the fall.
On the other hand, Apple is in news for showing interest in acquiring Perplexity AI, a leading AI startup founded by Indian-origin computer scientist Arvind Srinivas. Perplexity AI was initially mocked as little more than an “AI wrapper.” Now, its greatest strength lies in allowing users to choose from a range of powerful large language models (LLMs), though it also has its own LLM called Sonar. The startup has built various services on top of these LLMs, giving consumers real choice and flexibility. This ability to rapidly develop and launch new features on top of popular LLMs is what helped Perplexity gain its user base and rise in popularity. As of mid-2024, it reportedly had around 15 million users.