Bank of America Cuts Apple's Price Target After iPhone Launch
Following the launch of the new iPhone 18 Pro and Pro Max, Bank of America analyst Wamsi Mohan reduced his price target for Apple (AAPL) from $380 to $370. Although he maintains a 'buy' rating on the stock, Mohan noted that the pricing was below expectations, which could lead to higher sales volumes but lower profit margins due to rising memory costs. Apple is attempting to balance increased device prices with absorbing some of these elevated component costs, leading to expected gross margin declines in Q4. However, long-term optimism remains as future foldable iPhone Duo models may help restore margins through premium pricing and adoption rates among Pro Max users. Despite short-term challenges from memory cost pressures, Apple's strong product lineup and financial position continue to support its market appeal. The company is also benefiting from a strategic decision not to heavily invest in AI infrastructure at this time, allowing it to focus on refining existing high-end products while peers face rising costs.
Topics: Apple iPhone launch margins memory costs price target adjustment