BofA's Wamsi Mohan on call to raise Apple to a buy on gains from Alphabet ruling

Apple & Google Partnership - Apple stands to continue collecting $20 billion annually from Google, representing approximately 20% of Apple's $100 billion services revenue [3] - The potential loss of the Google payment represented 10-12% of Apple's total earnings, with the market already pricing in a 50% probability of an adverse ruling [9] - Analyst raised Apple's target price to $260, anticipating a 5% stock increase due to the avoidance of a significant earnings cut [10] AI Integration & Strategy - Apple is actively negotiating with OpenAI, Anthropic, and Google to integrate AI into Siri, aiming for a significant AI update next year [5] - Apple can leverage its access to a billion iPhone users to negotiate favorable terms with AI providers [6] - Apple aims to run AI models on its own servers within its data centers to maintain user privacy, potentially through licensing agreements [15] Future Valuation & Market Dynamics - The decline in Google search share is expected, but the pace will be managed, with Gemini potentially mitigating the impact [10][11] - Apple is positioned as a winner in the Gen AI context due to its distribution platform [13] - Apple can monetize AI applications through its services business, similar to the App Store model [16]