Apple’s AI features will create groundswell of demand

Discover Apple’s AI revolution.

Gene Munster from Deepwater Asset Management recently shared his insights on Apple’s upgrade cycle and the company’s future growth trajectory. With an anticipated upgrade cycle shift, the landscape of Apple’s growth and market share appears poised for significant changes.

Upgrade Cycle Acceleration

Munster emphasizes that consumers are eager to upgrade their devices more frequently. Traditionally, the upgrade cycle spans 36 to 40 months, but there’s an indication this period might shorten. The upcoming years seem promising, with projected growth of 3% in the June quarter, potentially reaching 4% if China’s performance is robust. This growth is expected to accelerate, hitting 4% to 5% in subsequent years and potentially 7% by 2025.

Apple’s Margins and AI Scaling

Munster highlights that Apple’s growth could surpass 10% next year, driven by record margins expected by late next year. Apple stands out as the only megacap company efficiently scaling AI in the near term. This efficiency, combined with margin improvements, could yield a 15% to 20% upside. Munster points out that while the upgrade cycle is crucial, there is a broader, more impactful story for long-term investors beyond just…