“Apple AI expectations peaked following the June 2024 announcement of Apple Intelligence, which positioned AI as having a quick impact on growth. In the end, the most important AI features never shipped, leaving Apple with a black eye and resetting how the company communicates upcoming AI features,” longtime Apple analysts Gene Munster writes for GeneMunster.com. “Since last summer, Apple’s AI communication strategy has been say less and show more. While consistent with Cook’s execution first philosophy, this approach has left investors wanting more, especially as other Mega Cap Tech peers aggressively detail how AI is reshaping their businesses.”
Gene Munster for GeneMunster.com:
On the [company’s Q126 conference] call, Cook reiterated that a new Siri, effectively shorthand for next generation Apple Intelligence, is coming this year, but provided no additional details. References to collaboration with Google’s Gemini were positive but lacked substance. Apple also made no mention of its recently reported $2B acquisition of an Israeli AI audio company, which could have served as a tangible signal of progress across AirPods, iPhone, or future wearables.
The result is a widening gap between thrilled customers and frustrated investors. Customers are more than satisfied, as evidenced by device growth, margins, and revenue momentum into March and June. Investors, however, remain in wait and see mode on AI. Until Apple provides clearer substance or demonstrates its capabilities in market, I expect this tension to persist, even as fundamentals continue to perform.
MacDailyNews Take: Based on results and, more importantly, very strong guidance, Apple stock should be well above $300 by now. It’s held back, as it’s always been held back, by an underwhelming caretaker CEO who’s long past his sell-by date, who lacks charisma, who totally missed the generative AI revolution, and who fails to generate even a modicum of excitement about the company’s future.
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The post Gene Munster: AI messaging, not fundamentals, is holding back Apple stock appeared first on MacDailyNews.
