Apple’s fiscal Q325 earnings report due today after market close is not expected to provide the boost investors need to lift the iPhone maker’s slumping stock, which has fallen nearly 17% in 2025. Hampered by a weak artificial intelligence strategy, significant tariff exposure, and regulatory scrutiny over its lucrative default search deal with Alphabet subsidiary Google, a near-term recovery for Apple’s shares appears elusive.
Ryan Vlastelica for Bloomberg News:
The technology behemoth is expected to post profit and revenue growth that severely lags the industry when it reports its fiscal third-quarter results Thursday after the market closes.
“Apple’s embarrassing AI shows how it has lost its mojo with innovation, and the lack of innovation speaks to the lack of revenue growth, and that speaks to why we don’t see upside in the stock,” said Peter Andersen, founder and chief investment officer of Andersen Capital Management. “It is valued like a growth stock, but I’m very skeptical about the potential for a significant inflection in growth, and I think it will eventually lose that premium.”
Analysts expect the company to report a 2.4% rise in quarterly profits on a 4.1% gain in revenues, according to data compiled by Bloomberg. The overall tech sector’s anticipated earnings growth is 16.8% on a 13% jump in revenue, according to Bloomberg Intelligence.
Apple’s failure to capitalize on AI is particularly important to investors, who are calling for a dramatic pivot in strategy. Many would like to see a management shakeup — or even a big acquisition, something Apple has historically shunned in favor of in-house development.
The problem is Apple’s in-house AI features, such as those unveiled at its Worldwide Developers Conference in June, have been delayed or underwhelmed. The company has reportedly considered using AI tech from outside companies to power a new version of its Siri digital assistant.
Apple’s failure to establish a firm AI strategy stands in contrast to its big-tech rivals, which have largely carved out niches in the technology and have put up impressive earnings this season.
After the market closed Wednesday, Microsoft Corp. reported significantly better-than-expected revenue on the back of strong cloud demand, while Meta Platforms Inc. — which has poached major AI talent from Apple with substantial pay packages — posted healthy results and gave a far better than anticipated outlook. Last week, Alphabet said that strong demand for its AI services boosted quarterly sales.
MacDailyNews Take: Frozen in oncoming headlights is where the buck stops.
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