UBS reiterated its Neutral rating and $236 price target on Apple (NASDAQ:AAPL), noting that iPhone sell-through trends turned negative year-over-year in February, particularly in China and Europe, where the company continues to lose market share.
According to UBS’ review of Counterpoint data, global iPhone sell-through dropped by 1% YoY, even as the broader smartphone market remained relatively flat. The declines were most pronounced in China (down 17%) and Europe (down 12%), signaling increasing competitive pressure in those regions.
While Apple did gain roughly 215 basis points of share in the U.S., overall iPhone sales in the region were still down 1%, reflecting a 5% contraction in the U.S. smartphone market during February amid muted promotional activity.
On a more positive note, Apple saw sell-through gains of about 20% in India and other emerging markets, though these increases came against easier comparisons from last year.
Initial demand for Apple’s latest SE model also underwhelmed, with only 300,000 units sold in its first month, far below the 700,000 units sold during the SE 2022 debut and a fraction of the 2.4 million units sold in the first month of the 2020 version.
UBS maintains a cautious stance, seeing limited upside in the near term as Apple navigates softening demand in core regions and lukewarm reception to its latest budget offering.