TLDR
- Citi Research raised its Apple price target from $315 to $365, keeping a Buy rating
- Analyst Asiya Merchant sees the iPhone 18 September launch as a key catalyst for investor sentiment
- Apple is expected to gain market share in smartphones and PCs despite rising competition
- Price increases are expected to offset margin pressures, with foldables also expected in Q4
- Apple is in a legal battle with OpenAI over alleged trade secret theft
Apple (AAPL) got a boost from Wall Street on Monday as Citi Research analyst Asiya Merchant raised her price target on the stock to $365, up from $315, while holding her Buy rating. The stock was trading at $316.06 in premarket, meaning the new target implies around 16% upside.
The move comes ahead of Apple’s earnings report scheduled for July 30.
Merchant said Apple is “well-positioned” to continue gaining market share in both smartphones and PCs, even as competition stiffens and the devices market slows.
A big part of her bullish case rests on the iPhone 18. The September launch, she wrote, “represents an important catalyst that could further strengthen investor sentiment.”
Apple has already moved to raise prices on some products. Merchant expects that strategy to continue into the iPhone 18 cycle, with price hikes focused mainly on higher-end models where she believes demand holds up better.
“While iPhone prices remain unchanged for now, we expect price increases in the upcoming September iPhone launch cycle,” Merchant wrote.
She also flagged the company’s loyal customer base as a buffer against any demand softness caused by those higher prices.
What About Apple Intelligence?
Merchant is not counting on Apple Intelligence to drive a major upgrade cycle in the near term. But she does think enhanced Siri capabilities will lift user engagement over time and support growth in Apple’s high-margin Services revenue.
She also raised the possibility that the new Siri AI rollout could eventually come with tiered pricing, which would be another boost to the Services division.
On the hardware side, Merchant expects Apple to launch foldable devices in Q4 of this calendar year.
The OpenAI Lawsuit
What the Citi note did not touch on was Apple’s legal fight with OpenAI. Last week, Apple sued its former AI partner for alleged trade secret theft, claiming OpenAI stole intellectual property “at every level” to develop its own hardware.
Apple’s lawyers called the lawsuit “a necessary step to expose and begin to remedy the pervasive theft of Apple’s trade secrets.”
OpenAI pushed back, with a spokesperson saying the company has “no interest in other companies’ trade secrets.”
The legal dispute marks a sharp turn in what was once a close partnership between the two companies.
Apple’s next earnings report is set for July 30.
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