Apple could stay in penalty box on AI delays

For the world’s most valuable company, a couple of pieces of reality have been clear for a while: Its current iPhone cycle is weak, with revenue from that product line up only 1.6% from a year earlier in the last six months of 2024. And despite weakness in the business that accounts for more than half of the company’s revenue, Apple’s stock has been a star—outperforming most of its megacap tech peers over the past 12 months and until recently carrying a valuation premium to all of them. These features were widely expected to be included in the new iOS update to be unveiled at the company’s Worldwide Developers Conference in June, especially since Apple previewed some of them at last year’s conference. “The delayed rollout of a more advanced Siri means Apple will have fewer features to accelerate iPhone upgrade rates in FY26," Morgan Stanley analyst Erik Woodring wrote in a report last week, referring to the fiscal year that ends in September of next year. That finally took some wind out of the stock; Apple’s shares slid nearly 11% last week in the worst weekly drop the stock has seen since late 2022, according to FactSet data.