A pivotal court decision has safeguarded a multi-billion dollar revenue stream for Apple Inc., prompting Bank of America to raise its price target on the tech giant’s shares. The positive legal development arrives just as the company prepares for its highly anticipated “Awe Dropping” event scheduled for next Monday, where it is expected to unveil the iPhone 17 and potentially introduce its most significant smartphone redesign in years.
Court Upholds Lucrative Google Search Partnership
The catalyst for the upgraded outlook was a ruling from a US federal judge. Judge Amit Mehta determined that Google can continue its practice of paying Apple billions of dollars annually to remain the default search engine on iPhones. While the judge prohibited Google from entering into exclusive agreements, he affirmed the legality of the current payment arrangement for prime placement.
In response to this decision, Bank of America analyst Wamsi Mohan increased the firm’s price objective on Apple from $250 to $260. The ruling provides substantial certainty for Apple’s high-margin Services division, which recently posted record quarterly revenue of $27.4 billion.
“iPhone 17 Air” to Showcase Radical New Design
The upcoming event is expected to feature a suite of new products, with the spotlight on the iPhone 17 lineup. According to analysts at Evercore, a new “Air” variant could be the star of the show. At a mere 5.55 millimeters thick, this model would represent a dramatic 35% reduction in profile compared to current generations, marking Apple’s most radical design shift in recent memory.
Beyond the new iPhones, the company is also anticipated to introduce next-generation Apple Watch and AirPods models. The event will likely showcase the upcoming iOS 26 operating system, which is rumored to include expanded artificial intelligence capabilities such as live translation and advanced photo editing tools.
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Strong Quarterly Performance Underpins Momentum
These product introductions are built upon a foundation of robust financial performance. Apple recently announced record third-quarter revenue of $94 billion, representing a 10% year-over-year increase and its strongest growth rate since late 2021. Notably, iPhone sales surged by 13.5% to $46.6 billion during the period.
AI Talent Departures Present a Challenge
Despite these strengths, Apple faces headwinds in the intensely competitive field of artificial intelligence. The company recently lost Jian Zhang, its lead AI researcher for robotics, to rival Meta Platforms Inc. Furthermore, three additional experts from Apple’s in-house large language model team have also departed, signaling potential challenges in retaining top AI talent.
Nevertheless, Apple continues to make significant investments in AI infrastructure, a strategic priority that is reflected in its substantially increased capital expenditures.
Long-Term Roadmap Points to Ambitious Hardware Future
Monday’s event may serve as the beginning of Apple’s most ambitious hardware strategy since the original iPhone’s debut. Evercore analysts point to a product roadmap extending through 2027 that includes a foldable iPhone slated for release in autumn 2026. This device is projected to feature a 7.8-inch display and carry a starting price of approximately $2,000.
Looking further ahead, a potential “iPhone 20” is being planned for 2027 to commemorate the product’s 20th anniversary. This visionary device could incorporate four-sided curved glass with no visible bezels. Whether Apple can successfully translate these ambitious designs into commercial success, particularly as tariff costs continue to pressure margins, remains a key question for investors.
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