Topline
Apple will hold its annual September product launch event later Monday, and, though the event is widely expected to focus on previously rolled-out artificial intelligence features coming to iPhones, there are several key watchpoints on the radar of Wall Street analysts.
Apple CEO Tim Cook delivers remarks at the start of the Apple Worldwide Developers Conference in … [+]
Key Facts
The event, dubbed “Glowtime” by Apple, will be the official debut of the company’s iPhone 16 line designed to support the integration of generative AI directly into the smartphone’s operating system, with AI expected to “play a starring role” Monday, predicted Morgan Stanley analyst Erik Woodring.
New features expected for the higher-end iPhone 16s include silicon chips designed to support AI and a new camera button, according to Bloomberg, which also reported non-iPhone announcements may include a new series of Apple Watches equipped with a sleep apnea detection feature and two new lines AirPod headphones.
Apple stock historically underperforms the broader market on the day of the annual September iPhone launches – the stock underperformed the S&P 500 by an average of 0.6 percentage percentage points on the 2013 to 2023 launches – but, given Apple took the historically unusual step of previewing the AI features coming to iPhone 16s in June, the 2024 event’s effect on Apple’s share price is less predictable.
The Morgan Stanley group identified three potential tailwinds from the event for Apple stock: Pricing for the iPhone 16, potential better batteries for the devices and more AI-associated processing power in the new devices, while Bank of America analyst Wamsi Mohan similarly identified price increases and more advanced AI features as drivers for the stock to outperform prior launch dates.
JPMorgan analyst Samik Chatterjee said other potential bullish signals would be a release of the newest iPhone operating system, iOS 18, by the first half of October, and teasing AI partners beyond OpenAI and its ChatGPT chatbot to give consumers “further reason for a device upgrade.”
Shares of Apple dropped almost 1% in morning trading, moving against a more than 1% gain for the tech-heavy Nasdaq Composite stock index, and Apple stock is down more than 4% this month amid a broader market slump.
How Can I Watch Apple Event?
The event will stream live on Apple’s YouTube channel here starting at 1 p.m. EDT.
Big Number
13%. That’s how much Apple stock is up since the company’s June Worldwide Developers Conference, trouncing the S&P 500’s 2% gain during the period thanks in large part to investor optimism for a major iPhone upgrade cycle tied to the AI features.
Crucial Quote
“The magnitude of variability relative to expectations is likely a lot higher” for Apple than leading up to prior September events, according to Chatterjee.
Key Background
Apple is by far the largest company in the world by market capitalization, worth about $3.3 trillion Monday. Significant expectations are riding on the iPhone 16, as the company is fresh off of its weakest quarterly revenue for iPhone sales since 2021. More than half of Apple’s revenues come from iPhones. Among the features of the “Apple Intelligence” update are generative writing prompts, customized emoji icons and an enhanced Siri voice assistant.