Apple CEO Tim Cook attends the China Development Forum in Beijing on March 24, 2024.
Pedro Pardo | AFP | Getty Images
Apple Shares jumped more than 6% Friday morning after the company reported better-than-expected second-quarter earnings and the largest-ever stock buyback program. If the gains hold until the market closes, it will be the best day for Apple stock since November 30, 2022.
The iPhone maker announced Thursday that it would repurchase $110 billion of its shares, the largest repurchase in U.S. history, surpassing Apple’s previous repurchases. The company posted earnings of $1.53 per share on revenue of $90.75 billion, beating analysts’ estimates of earnings per share of $1.50 per share on revenue of $90.75 billion. business of $90.01 billion, according to LSEG.
But overall sales fell 4% and iPhone sales fell 10% year-over-year during the quarter, indicating a decline in demand for the latest generation of smartphones. Apple CEO Tim Cook told CNBC that quarterly sales suffered from a tough comparison to the year-ago period.
Bank of America analysts reiterated their buy rating on Apple shares – calling them a top pick – and raised their price target from $225 to $230 in a note to investors on Friday, writing that they expect the company to roll out generative artificial intelligence features for the iPhone. This year.
“Apple is developing iPhones in mainland China, estimate revisions are turning positive and GenAI features will drive a strong upgrade cycle,” they wrote.
Analysts at JPMorgan, now overweight, raised their price target for Apple to $225 from $210 on Thursday, highlighting the “resilience” of year-over-year iPhone revenue and “expectations for a tailwind induced by the upgrade cycle in iPads” before Apple’s product. launch event next week.
“Overall, while modest year-over-year revenue growth may not be the ideal outcome,” they wrote, “it now provides visibility into more revenue opportunities high in the coming years with tailwinds from product cycles on hardware devices as well as an AI-driven smartphone cycle further driving growth.”
Analysts at Morgan Stanley maintained their overweight position on Apple and raised their price target to $216 from $210 on Friday, citing the company’s quarterly performance, year-over-year growth in shipments of iPhone to China in March, stock buyback and hints of upcoming AI updates. .
“It’s hard not to be more optimistic here,” they wrote.
CNBC’s Michael Bloom contributed to this report.
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