There's no denying it. Apple (AAPL +1.05%) was not only late to the artificial intelligence party, but it has struggled to catch up.
While the world was admittedly interested in Apple Intelligence's features unveiled in June of last year, demand for this tech -- as well as hardware that can handle it -- has been ho-hum. In fact, iPhone revenue fell during the quarter ending in December, while technology market research outfit IDC reports that unit sales of the iPhone slumped 4.1% year over year for the quarter in question. The company's AI-powered virtual assistant Siri has since been transferred to a new chief as well, after senior director Robby Walker called Apple's artificial intelligence results so far "ugly and embarrassing."
And yes, Apple shares have underperformed this year largely because of its disappointing artificial intelligence efforts.
NASDAQ: AAPL
Key Data Points
Then again, perhaps the market was always expecting too much too soon. As UBS analyst David Vogt recently penned, investors shouldn't "expect a significant improvement to Apple Intelligence over the next 12 months even with the upcoming [iPhone] 17 series in the fall of 2025," echoing timeline concerns voiced by Jefferies analyst Edison Lee and Wedbush's Dan Ives.
All three analysts, however, see AI-driven growth for Apple on the horizon once the company makes Apple Intelligence more marketable. In this vein, investment research house Imarc predicts the intelligent virtual assistant market is set to grow at an annualized pace of 26% through 2033. The market's likely to see this growth coming sooner rather than later, however, and simply sensing what awaits could be enough to (re)light a fire under this stock.
Analysts see it coming anyway. The analyst community's current 12-month consensus price target for Apple stands at $253.71 per share, up 15% from the stock's present price. Most of these analysts also rate Apple stock as at least a buy at this time.
The only missing ingredient is a catalyst convincing investors that Apple's AI efforts are back on track. The only problem? Once such a catalyst materializes, it may then be too late to step into a stake.
