Evercore ISI analysts reiterated their Outperform rating on Apple (NASDAQ:AAPL) with a $250 price target, citing strong growth in App Store revenue. In August, App Store revenue increased by 12%, slightly up from July’s 11% growth, despite facing more challenging comparisons. If this trend continues, Apple’s Services growth could hit the high end of its guidance range of 11-14%.
The growth has been driven by stable performance in China and Japan, boosted by new gaming titles, with European Union revenues up 25% year-over-year despite regulatory changes. The analysts suggest that as long as major components like the App Store and Google Payment maintain their momentum, Apple’s Services segment should continue to grow in double digits, with potential for upside. They noted that while more challenging comparisons in the latter half of 2024 could slow growth, this has not yet occurred. The analysts view the consistent App Store performance as a positive indicator for potential upside in Apple’s September quarter results.