Don't Worry About Short-Term Headwinds, Apple Is Positioned For Long-Term Success, Analyst Says

Apple, Inc. (NASDAQ: AAPL) shares have already fallen more than 5% in 2024 as the company battles weaker consumer demand and restrictions in the Chinese market, but one analyst believes the company is well-positioned for long-term success.

What Happened: Neuberger Berman senior research analyst Daniel Flax appeared on CNBC’s "Squawk Box" on Wednesday to discuss Apple’s future growth, as well as potential upcoming product innovations.

The analyst noted that Apple has a history of consistently reinventing its product line and he highlighted the company's broadening of its revenue channels through wearables and services.

When discussing Apple’s services revenue, Flax noted that the App Store continues to be a profitable and innovative platform even though the tech giant has faced regulatory hurdles recently.

Apple is also expected to continue to build on its product innovation trend as it explores spatial computing with its new VisionPro hardware, Flax said. 

On the iPhone front, consumers are waiting longer before upgrading to new models, he said, adding that the longer product replacement cycle means Apple is selling fewer product units. However, consumers are gravitating towards the more expensive Pro and Pro Max models as the company integrates its most advanced features into its higher-end devices.

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The Neuberger Berman analyst predicted that Apple will focus on expanding the current generative AI capabilities of Siri and the company's health apps. He expects Apple to begin incorporating AI capabilities and features into its high-end devices, making its top product lines even more desirable for consumers.

“You will see, I suspect, more customers continue to reach for the very best device they can afford because the capabilities are so foundational to their every day,” Flax said.

AAPL Price Action: According to data from Benzinga Pro, Apple shares ended the session 1.27% lower at $181.91.

Image: courtesy of Apple.