Title: Apple Stock Analysis: Mizuho Analysts Predict Stable iPhone Sales and Potential Rebound by 2025
Investing.com -- As the world's top investment manager, I can confidently say that Mizuho desk analysts are bullish on Apple (NASDAQ:) stock, labeling it as an "out of favor long idea." Despite negative headlines and sentiment surrounding iPhone unit declines, the analysts believe that Apple's fiscal 2025 iPhone sales, especially for the iPhone 16, will remain relatively stable. They project sales to be flat to slightly down in the low single digits year-over-year, which is better than what many investors fear.
Looking ahead, the analysts anticipate a rebound for Apple stock after a challenging period through March 2025. This rebound is expected to be supported by the June iOS preview and the launch of a more AI-integrated iPhone 17 in September 2025. The analysts emphasize that patience will be rewarded, with limited near-term downside risk as the buy-side sentiment is extremely negative and short.
Mizuho's team has revised their estimates for iPhone unit production, expecting a 6% decline in 2024 to 220 million units for the iPhone 16 model. However, they foresee a rebound in 2025, with an estimated 8% increase in unit sales to 239 million units, driven by the introduction of the new iPhone SE and the anticipated iPhone 17. Looking even further ahead to 2026, the unofficial view suggests that iPhone unit sales could reach around 250 million.
In addition, Mizuho analysts predict that Apple's upcoming iPhone 17 will sell 97 million units in calendar year 2025, which is approximately 10% higher than the revised forecast for the iPhone 16. This positive outlook could benefit DRAM manufacturers like Micron Technology (NASDAQ:), as the new iPhone models are expected to include higher amounts of DRAM.
Furthermore, the analysts anticipate that Apple will start using its own internal modem chips with the iPhone 18, moving away from Qualcomm (NASDAQ:)'s modems. This transition is expected to be complete for all iPhone models by the time the iPhone 18 is launched. Additionally, Apple is rumored to launch a foldable iPhone in calendar year 2027, which could lead to increased investment in G6 OLED panels.
The introduction of new AI software features in iOS is expected to enhance the upgrade and replacement cycle starting with the iPhone 17. Despite the negative sentiment from the buyside, the analysts believe that the current short position on AAPL and iPhone supply chain is crowded and lazy.
In a separate note, Mizuho Asia analysts highlighted Apple's focus on AI services and related components in their iPhone roadmap. They expect a downturn in DRAM prices by early 2025 to help reduce costs across the supply chain. Key developments to look out for include the introduction of in-house modems in 2025 and foldable OLEDs by 2027. While AI services could drive increased device upgrades, the full value of these services will need to be evaluated.
In conclusion, this analysis provides valuable insights into Apple's future prospects, particularly in the iPhone segment. Investors should consider the stable sales projections for fiscal 2025, the potential rebound in stock price post-March 2025, and the upcoming innovations such as the more AI-integrated iPhone 17. Additionally, the transition to in-house modem chips and the introduction of a foldable iPhone in 2027 could have significant implications for Apple's growth trajectory. It is important for investors to stay informed about these developments and consider them in their investment decisions.