Despite record third quarter results, Apple remains in the investor doghouse

Apple Park in Cupertino, California
Apple stock slid Friday despite the company’s better-than-expected June-quarter results, showing that it’s still in the investor doghouse.
The Cupertino, Calif.-based company late Thursday said it earned $1.57 a share on sales of $94.04 billion in the fiscal third quarter ended June 28. Analysts polled by FactSet had expected earnings of $1.43 a share on sales of $89.35 billion. On a year-over-year basis, Apple earnings rose 12% while sales climbed 10%.
Patrick Seitz for Investor’s Business Daily:
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For the current quarter, Apple expects its total revenue to increase by a mid- to high-single-digit percentage year over year. Analysts had been modeling for sales to rise 2.8% to $97.6 billion in the fiscal fourth quarter.
In morning trades on the stock market today, Apple stock fell more than 1% to 205.22, as the broader market retreated on the latest tariff news. It is down about 17% for the year and is dwelling in a “death cross” chart pattern.
“Despite the beat and slightly higher September-quarter guidance than we estimated, we remain concerned on second-half (2025) momentum, given lack of exciting iPhone cycle and AI differentiation,” Barclays analyst Tim Long said in a client note.
Other concerns include potential smartphone market share loss in China from new Huawei handsets and folding-screen devices. Plus, Apple faces the possible loss of traffic acquisition cost, or TAC, payments from Google as the default search engine on the iPhone.
In addition, Apple has faced delays in rolling out new artificial intelligence features, such as an upgraded Siri digital assistant.
Wedbush Securities analyst Daniel Ives said Apple’s efforts in AI to date have not moved the needle much and “patience is wearing thin” among investors.
Ives believes Apple’s internal development efforts on AI are not doing the job and the company needs to make a significant acquisition, such as Perplexity
“The AI Revolution is the biggest technology trend in 40 years and right now Apple is watching this from a park bench drinking lemonade while every other Big Tech company is racing ahead like F1 drivers building out its AI strategy and monetization plan,” Ives said in a client note. “The status quo is clearly not working” at Apple.

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MacDailyNews Take: Again, as we wrote earlier this morning, “The stock price is still rangebound… A notable AI acquisition or some other meaningful AI news would break that constraint.” More here.

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