Apple shares faced fresh pressure on Monday after Jefferies cut its rating on the tech giant to Underperform from Hold, citing worries about the company’s ability to sustain higher average selling prices for iPhones amid production setbacks and rising costs.
Analyst Edison Lee lowered the firm’s price target to $263.66 from $285.56, implying roughly 16% downside from recent levels. The move adds to a growing list of more cautious views on the world’s most valuable company.
Jefferies pointed to supply-chain checks indicating that Apple has canceled plans for a Twentieth anniversary all-glass iPhone model originally eyed for a September 2027 launch. The cancellation stemmed from poor production yields. The firm described the decision as “a major setback” to Apple’s efforts to introduce higher-priced devices at a time of soaring memory costs.
According to the note, Apple had intended to extend all-glass design features to future iPhone Pro and Pro Max models to further lift average selling prices and margins. With that path now in doubt, Jefferies reduced its estimated compound annual growth rate for iPhone ASPs between fiscal 2026 and 2031 and cut its fiscal 2028 and 2029 earnings-per-share estimates by about 2% and 3%, respectively.
Lee also flagged recent increases in trade-in values for iPhones in the U.S. and Europe. While those moves could pull forward demand for the current iPhone 17 cycle, they risk creating greater pressure on sales of the subsequent iPhone 18 generation.
The downgrade comes as analysts continue to debate Apple’s long-term smartphone growth trajectory, particularly its capacity to drive premium pricing and volume expansion in a competitive market. Sell-equivalent ratings remain relatively scarce among the broader analyst community, but the latest cut underscores mounting scrutiny of Apple’s hardware roadmap.
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Please – what a dumb reason to downgrade – these analysts really have no idea how Apple operates they just make crap up.
Bound to happen Tim Cooks killing of new products and innovation has come home to roost.Its regretful but up to the new team to revitalise the company or move to a slow death and retraction like Nokia.
Here it comes, called it again. It’s gonna start chipping at the rock and Apple can’t do anything to stop the decline. They Should invest into their own component fab shops and NOT rely on others, but they won’t. If they came out an said, “They are investing 5 Billion in to their own memory fab”, how would that affect their stock? All the other companies are in the same situation and can’t change it. Apple Will be able to secure the future of their own memory so the market won’t affect them only in the short term of wind up. They can spend a few billion and not feel it. WILL They? Nope. and people will argue “Apple Can’t”, or “the market constraints will ease”, “Just Wait”, Why? Apple is already losing, so best to invest into itself.
It would cost closer to $20 billion (not $5 billion) to set up a memory fab, double that for operating costs over a decade, years to bring online and most likely perfectly timed for a downturn in the memory market. The AI bubble is popping already, in 1-2 years there will be a glut of memory on the market and Apple will have plenty of dry powder for Micron’s fire sale.
They are already feeling the pain, a 10 year block that’s gonna affect their company. You “THINK” it’s gonna be fixed in 1-2 years, Can you predict that? no. can Apple afford to fix it? Yes. The other companies can’t. Watch the stock go down to 275, mark it.
It may seem a bit of a reach, but really….?
An ALL-GLASS iPh that marks it’s 20th year is conceivably worth a 2 point d-grade.
It’s an anniversary that marks the object that has truly changed the World.
Collector’s grade.
I’d call it not just a product miss (ie., Titan), but a huge symbolic/historical miss that’s worth a material downgrade.
If there was ever a year to release a glass phone….