JPMorgan analysts reiterated their Overweight rating for Apple (NASDAQ:AAPL) with a price target of $265 on the stock. The analysts anticipate a mixed outlook for the tech giant, expecting stronger-than-anticipated results for Q4/24 (scheduled on October 31) but weaker guidance for Q1/25.
They highlighted that Apple’s history of surpassing its own guidance could set the stage for positive market reaction following the September quarter earnings release. Industry reports suggest that a smooth supply ramp for the iPhone 16 positioned Apple well for Q4/24 shipments, with inventory being built up in preparation for the holiday season.
However, initial sell-through for the iPhone 16 series started slower than the iPhone 15, despite recent improvements. This slower pace, even as it gains momentum, is expected to result in iPhone revenues for Q1/25 falling below consensus estimates, though they are likely to show year-over-year growth due to higher average selling prices and product mix shifts.
Looking further ahead, the analysts remain optimistic about Apple’s longer-term prospects. They expect demand to strengthen further with the rollout of Apple Intelligence, predicting a stable iPhone volume forecast of 245 million units for 2025. This improved demand could serve as a catalyst for Apple, potentially leading to above-consensus revenue in the March and June quarters of 2025.