July 2 - Apple (AAPL, Financial) was upgraded to 'Hold' from Underperform by Jefferies, as the bank sees potential upside in third‑quarter iPhone sales.
Shares climbed about 1% in early trading on Wednesday after the upgrade.
Jefferies analysts, led by Edison Lee, pointed to data from Counterpoint Research showing a 15% year‑on‑year increase in global iPhone volumes during April and May, the strongest growth since 2021. They noted 12.5% growth in the March quarter, driven in part by Chinese demand pulled forward through discounting.
“We estimate iPhone sales in China rose about 19% year‑over‑year during the June promotions, driving roughly 10% growth in the quarter,” Lee wrote, adding that Apple appears determined to defend market share with targeted discounts and government subsidies.
On that basis, Jefferies lifted its Q3 forecast to 49.4 million units, implying 9% growth versus its prior 1% outlook. However, the firm cut its September quarter projection by 11% to 46.3 million units, down 6% year‑on‑year, citing a lack of new features and the absence of AI as a game changer.
Apple's fiscal third‑quarter results, covering April 1 to June 30, are due around July 31, with analysts forecasting revenue of $88.67 billion and earnings per share of $1.42.
Investors will be watching for any upside surprises in iPhone growth to sustain momentum.
