Apple(US:AAPL) Southwest Securities·2024-07-10 01:31Investment Rating - The report maintains a "Buy" rating for Apple (AAPL.O) [37] Core Insights - Apple Intelligence is expected to drive a new wave of innovation and growth for Apple, enhancing hardware upgrade demand and software service value [1][8][19] - iPhone sales are projected to grow at a compound annual growth rate (CAGR) of 10% from FY2025 to FY2026, while Mac sales are expected to grow at a CAGR of 7.5% during the same period [1][8] - The software services business, which has seen a CAGR of 21.4% from FY2006 to FY2023, is anticipated to grow at a CAGR of 10% over the next three years due to the integration of AI [2] Financial Summary - Revenue (in million USD): - FY2024E: 394,328 - FY2025E: 418,154.10 - FY2026E: 454,173.01 - Revenue Growth Rate: - FY2024E: 1.11% - FY2025E: 7.90% - FY2026E: 8.61% - GAAP Net Profit (in million USD): - FY2024E: 99,803 - FY2025E: 102,015.30 - FY2026E: 125,603.57 - Net Profit Growth Rate: - FY2024E: 5.18% - FY2025E: 10.80% - FY2026E: 11.12% - Earnings Per Share (EPS): - FY2024E: 6.51 - FY2025E: 7.37 - FY2026E: 8.19 - Price-to-Earnings (PE) Ratio: - FY2024E: 33.11 - FY2025E: 29.88 - FY2026E: 26.89 [3][37] Apple Intelligence Features - Apple Intelligence integrates system-level AI, enhancing efficiency and user experience across applications, with Siri as the core interaction point [36][114] - It features cross-application information integration, allowing for semantic indexing of photos, calendars, and files, leveraging Apple's integrated ecosystem [20][36] - The architecture includes a local large language model, a cloud model, and external GPT models, optimizing performance through pre-training, fine-tuning, and various enhancements [23][36][71]