Core Viewpoint - Apple's services business is experiencing consistent double-digit growth, significantly contributing to earnings per share growth, which is outpacing revenue growth [1][5]. Financial Performance - In fiscal 2021, Apple's revenue increased by over 33% year over year, followed by an 8% growth in fiscal 2022, resulting in a total revenue increase of 44% over two years [2]. - Despite muted sales growth post-fiscal 2022, Apple's five-year compounded revenue and earnings-per-share growth remains impressive [3]. Growth Catalysts - Apple is expected to see easier sales comparisons moving forward, which should facilitate sales growth [6]. - Management anticipates revenue growth of 10% to 12% year over year for the first quarter of fiscal 2026, driven by a strong new iPhone lineup [7]. - The services segment is projected to grow by 14% year over year in fiscal 2025, with similar expectations for the first quarter of fiscal 2026 [8]. Artificial Intelligence Impact - Apple's AI features are beginning to influence purchasing decisions, with potential for significant future impact on sales [9]. - The company has a history of launching new products and features that drive substantial sales growth, suggesting that AI could unlock new opportunities [11]. Investment Perspective - The combination of AI potential and Apple's history of successful product launches positions the company as a "sleeping giant" with the potential for significant acceleration in business performance [11].
Here's Why This Sleeping Giant Is My Top "Magnificent Seven" Stock To Buy in January