AAPL
Apple Inc (NASDAQ: AAPL) is set to unveil its latest operating system, iOS 18, at the annual Worldwide Developers Conference (WWDC), which will be held on June 10-14.
New AI Features and iOS 18 Expected
Anticipation is high for generative AI features to be integrated into Apple apps like iMessage, Photos, and Safari. This move follows the recent announcement of the new iPad Pro, powered by the M4 chip, which supports running AI applications locally. While Apple has been relatively quiet about its AI initiatives compared to peers, this year's WWDC could mark a significant step in its AI journey.
AI-Fueled iPhone Upgrade Cycle
Bank of America (NYSE: BAC) analysts predict that AI-enabled phones, dubbed "IntelliPhones," could drive a significant multi-year upgrade cycle for Apple.
They expect the adoption of these AI phones to surpass the adoption rates of smartphones and 5G. With over 4 billion smartphones in use globally, Apple is poised to lead a major upgrade cycle, potentially creating a "once in a decade" event. This cycle could revolutionize the smartphone market, much like the introduction of smartphones did.
Apple might also address recent reports about a potential partnership with Microsoft-backed OpenAI (NASDAQ: MSFT) and Google (NASDAQ: GOOG).
Such an agreement could involve licensing AI models like GPT-4 and Gemini to enhance Apple software and devices. An AI partnership could also bring substantial upgrades to Apple's voice assistant, Siri, making it more competitive in the AI landscape. This collaboration could further solidify Apple’s position in the AI sector.
Expectations:
| Key Points | Details |
|---|---|
| iOS 18 Launch | Unveiling at WWDC |
| New iPad Pro | Powered by M4 chip |
| AI Phone Upgrade Cycle | Predicted by analysts |
| Potential AI Partnership | OpenAI and Google |
| Stock Impact | Expected positive trends |
| Recent Stock Performance | +8.8% over past 12 months |
Impact on Apple Stock
Analysts from Melius Research believe this year's WWDC could be Apple's most significant since the launch of the iPhone in 2007.
Historically, Apple’s stock tends to rise leading up to the event and then sell off. However, AI-related announcements have disrupted such patterns for other stocks and might do the same for Apple.
Melius suggests that WWDC announcements could boost iPhone sales and secure long-term growth for Apple's high-margin services revenue. This positive outlook could be crucial for long-term investors.
