Apple's stock faces margin pressure from rising memory costs and a rich valuation that dampens the bull case despite strong operating performance. The company warned that substantially higher memory prices are expected to weigh on margins in the June quarter, with pressure likely to intensify in subsequent quarters. Apple reported fiscal Q2 revenue of $111.2 billion, up 17% year-over-year, with iPhone revenue of $57 billion and Services revenue of $31 billion, up 16%. However, AAPL stock trades at 33.5 times forward earnings, a premium valuation relative to expected earnings per share growth of 17.2% in fiscal 2026, moderating to 9.5% in fiscal 2027. Wall Street analysts maintain a Moderate Buy consensus rating on the stock.
Apple Inc.Rising memory costs are expected to weigh on margins in the June quarter and beyond.