Apple’s (AAPL) AI strategy has been quiet for a while, but things could change quickly.
Wedbush analyst Dan Ives raised his 12-month price target on Apple to $400 from $350, making it the most bullish call among major Wall Street analysts, according to TheFly.
The move shows a broader view that Apple’s AI push may still be in its early stages, even if investors have not seen much of it reflected in the numbers yet.
For perspective, the year has been mostly wonky for Apple stock, with it rising around 8% year-to-date according to Seeking Alpha.
However, in the past month, it seems to be building a healthy head of steam, jumping 13.2%.
That said, Ives is arguing that Apple has the potential to become one of the main consumer gateways to AI over the next few years.
Why Apple’s bull case is growing
Apple’s bull case hinges on its massive customer base, which no pure AI startup can match.
For the next few years, Wedbush believes about 20% of the world’s population will have access to AI with an Apple device. So clearly, this isn’t just a regular business adding a new feature to its devices.
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The analyst note also marks an opportunity for Apple to monetize AI features, premium storage, and on-device intelligence.
Wedbush estimates the value of those pieces over time to be as much as $15 billion in annual services revenue.
It is a significant number, as it shows that it is a higher-margin stream that doesn’t rely solely on new hardware cycles.
The key pieces of the Wedbush Apple AI thesis
The bullish view rests on a few moving parts:
- A massive user base: Apple’s devices already reach hundreds of millions of people, which makes distribution easier than it is for most tech companies.
- Higher services revenue: AI tools could push users toward premium storage, paid AI features, and more recurring spending.
- A China angle: Wedbush says Apple’s partnership with Alibaba should help support its AI rollout in China, despite political scrutiny.
- A bigger hardware reset ahead: The 20th-anniversary iPhone redesign expected in 2027 could help sharpen Apple’s AI strategy..
Taken together, those pieces suggest Apple’s AI story may not be about a single product launch. It may be about a long transition in how the company monetizes its ecosystem.
What this means for Micron and other chip stocks
Apple’s AI push does not happen in isolation.
If the company leans harder into on-device inference and private cloud compute, it will need more memory and storage across its devices and servers, boosting Micron Technology (MU) and other pure-plays in its niche.
As I covered in a recent piece, Apple’s AI features should require more high-bandwidth DRAM and NAND flash, especially as models run locally on the device. That can raise content per iPhone and Mac.
There is also a data center angle. Apple’s Private Cloud Compute and other AI services require server infrastructure, which can create another demand stream for memory suppliers.
Other Wall Street targets for Apple include
- Morgan Stanley: $330.
- Goldman Sachs: $340.
- JPMorgan: $325.
- Bank of America: $325.
- UBS: $287.
Apple’s recent AI cues
Apple’s AI effort is starting to show up as just last week, CEO Tim Cook said the Mac mini saw stronger-than-expected demand as developers bought it as a local AI workstation. The shortage is expected to last for months.
That may seem like a small data point, but it fits the broader story. Apple’s AI ambitions are not only about consumer features. They are also helping shape new usage patterns across hardware.
Apple’s annual recurring revenue tied to AI has already passed $5 billion, according to management.
Even so, that figure has not yet become a major top-line driver. That is what makes the Wedbush call interesting.
It suggests the market may be underestimating how much AI could matter once the revenue starts to scale.
Apple stock returns vs the S&P 500
- Over the past week, Apple stock rose 3.74%, compared with a 1.95% gain for the S&P 500.
- Over the past month, it rose 13.18%, compared with an 8.57% gain for the S&P 500.
- Over the past six months, it rose 7.80%, compared with an 8.03% gain for the S&P 500.
- Year to date, it rose 8.44%, compared with an 8.11% gain for the S&P 500.
- Over the past year, it rose 39.85%, compared with a 26.64% gain for the S&P 500.
- Over the past three years, it rose 70.83%, compared with a 79.46% gain for the S&P 500.
- Over the past five years, it rose 140.12%, compared with an 82.15% gain for the S&P 500.
Source: Seeking Alpha.
What still needs to happen
The bull case is not automatic.
For Apple to justify a $400 target, a few things need to go right:
- AI services have to become visible in the numbers.
- China’s execution has to hold up.
- The next major iPhone redesign needs to land well.
- Apple has to convert AI usage into recurring revenue, not just interest.
That is a high bar, but not an impossible one.
For now, the market waits and sees if proof will emerge. Apple’s AI plan, which has been lacking visibility until now, will make its move to become a viable earnings booster for Wedbush’s prediction.
That could be the only one getting a rerate, though, if Apple is the one to do it. There’s a degree of benefit for the suppliers that supply the AI device cycle as well.
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