Apple(AAPL) 华安证券·2024-12-31 09:29Investment Rating - The report gives Apple (AAPL.O) an "Overweight" rating, citing its strong fundamentals and growth potential [3] Core Views - Apple Intelligence, launched in 2024, is expected to drive a new growth cycle for iPhone and other hardware products, leveraging AI capabilities [5][12] - Apple's ecosystem, user loyalty, and brand strength provide a competitive moat against Android competitors [72][87] - The integration of AI features is expected to accelerate hardware upgrade cycles, particularly for iPhone [81][111] Business Overview - iPhone remains the core revenue driver, contributing ~70% of Product revenue, while Services revenue has been growing at ~10% annually [134] - Apple's Services business, including App Store, iCloud, and Apple Music, benefits from a large and growing user base of 2.2 billion active devices [101] - Product revenue has seen low single-digit declines in recent years due to macroeconomic headwinds and high base effects from the iPhone 12 cycle [134] AI and Technology - Apple Intelligence, integrated into iOS, iPadOS, and macOS, offers AI-powered features like writing tools, image generation, and enhanced Siri capabilities [12][137] - The AI system combines on-device models, private cloud computing, and external GPT models to ensure privacy and efficiency [158][62] - Apple's on-device and server models outperform many larger models in benchmark tests, particularly in safety and writing tasks [52][174] Competitive Landscape - Apple dominates the high-end smartphone market, with limited competition in its price segment, especially in developed markets like the US and Japan [87][199] - The company's strong brand identity, design excellence, and iOS ecosystem create high switching costs for users [191] - While Chinese manufacturers like Xiaomi and OPPO are gaining share in the mid-range market, they face challenges in competing with Apple in the premium segment [199] Financial Performance and Outlook - Apple's revenue is expected to grow at a CAGR of ~7% from FY2025 to FY2027, driven by AI-powered hardware upgrades and Services growth [105][108] - Non-GAAP EPS is projected to increase from 9.49 in FY2027, reflecting a 10.6% CAGR [105][108] - The company maintains a strong balance sheet, with consistent dividend payouts and share buybacks [105]