Analyst Says Apple (AAPL) Will Have Problems in Second Half of 2025 – ‘They Still Don’t Have AI Strategy’

Apple Inc (NASDAQ:AAPL) is one of the 10 Buzzing Stocks to Watch as AI Trade Makes a Comeback.

CNBC’s Dan Nathan, who is also the principal of RiskReversal Advisors, talked about a downgrade from Jefferies on Apple Inc (NASDAQ:AAPL) and said the company will face further headwinds in the second half of the year. The analyst appreciated the downgrade:

“I think that there’s not a lot of catalyst right here. And I think you could say, well, the sentiment’s really bad when you have someone like this guy who’s one of like five sells on the street — which is kind of weird for Apple Inc (NASDAQ:AAPL), by the way, that it has five sells. You look at the rest of the Mag 7, I think like 90% of the ratings are buys on all of them. So, you know, kudos to this guy, depending upon where he put it on.

There’s going to be a pull forward. I mean, the Q2 for a lot of these companies is going to be better than a lot of folks thought in early April, right, when they’re selling stocks or tripping over themselves to do so. But the back half of the year for a company like Apple Inc (NASDAQ:AAPL) is going to be a problem. They still don’t have an AI strategy. So that means that a product that has not been growing for the last three years is not going to grow again. I mean like, literally, they’re going to miss an entire year of a product cycle. So I think there’s probably better growthier places to be.”

Apple Inc (NASDAQ:AAPL) is desperately in need of new catalysts. The company’s revenue in China fell 8% in fiscal year 2024, following a 2% decline the previous year. The Chinese market accounts for about 15% of Apple’s total revenue, so this downtrend cannot be ignored.

Investors had hopes from the Wearables, Home, and Accessories segment, but so far, its performance has been weak. Vision Pro faces tough competition from Meta’s $500 Quest and the more affordable Quest 3S, making it hard to justify its $3,500 price tag. The failure of Apple’s HomePod, unable to compete with Amazon’s and Google’s lower-priced offerings, further highlights the challenges in this market.

Apple’s iPhone 16 has not shown promising growth prospects yet and investors are still in a wait-and-see mode on the AI platform.

Columbia Seligman Global Technology Fund stated the following regarding Apple Inc. (NASDAQ:AAPL) in its Q1 2025 investor letter:

“The fund maintained an underweight position in Apple throughout the quarter. Apple Inc.’s (NASDAQ:AAPL) stock pulled back during the first quarter, in line with the performance of many other technology stocks, and the company experienced some challenges of its own during the quarter. Apple delayed the release of an AI-upgraded Siri, claiming that the new Siri was taking longer to complete than the company expected, and it should come out later this year. The U.S. Department of Justice also stood firm — as it did during the prior administration — in asking a federal judge to block Google from paying Apple and other companies to secure its search engine as a default on smartphones and other devices.”

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Disclosure: None. This article is originally published at Insider Monkey.