Apple (NASDAQ: AAPL) is in talks with Alphabet (NASDAQ: GOOGL) to incorporate Google’s Gemini AI engine into the iPhone.
According to insights from BofA Securities, if Apple manages to strike a deal with either Google or OpenAI, it could introduce additional hardware functionalities as early as 2025.
Wamsi Mohan, an analyst at BofA Securities, expressed optimism regarding Apple’s prospects, maintaining a bullish outlook with a Buy rating and a price target of $225 for the company’s stock.
In the note, Mohan suggested that Al could spearhead a “multi-year upgrade cycle,” paving the way for the company to improve gross margins in the future.
The analyst wrote,
“It remains unclear if Apple will choose to leverage a cloud-based model that could potentially have higher latency vs. on-device option.”
He added,
“We view incremental on-device functions, especially in 2025.”
The analyst cautioned against the financial implications of a licensing agreement, especially given Apple’s massive user base of 2.2 billion. Mohan proposed potential pricing structures, suggesting that a fixed charge per device for on-device features could expedite the time to market while concurrently fostering in-house technological advancements.
Apple (NASDAQ: AAPL) Stock Price Action
AAPL stock gained 0.64% to close at $173.72 on Monday. The traders had exchanged hands with 75,222,338 (75.22 million) shares compared to the average daily trading volume of 58.51 million.
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Salman Akhtar is a finance, stocks, and technology journalist with years of experience across various news organizations. He has contributed his expertise to outlets such as 24NewsHD, TrimFeed, The Voice Pakistan, and TheTechBasic. Salman is passionate about making complex topics accessible to a broad audience. His dedication to delivering accurate and timely information has established him as a trusted voice in the industry. Read Full Bio
