Bull vs Bear: Is Apple’s Siri AI push rotten – does it matter?

Apple shares have fallen the last couple of days after its annual developer conference left investors wondering just how quickly it’s going ahead with its AI plans.

Investors were paying close attention to Apple’s Worldwide Developers’ Conference (WWDC 2026) for a clear signal that the Cupertino firm is on track (back on track?) with its AI roadmap after seeming to fall behind some competitors. The answer from the market seemed to be ‘not bad, but not enough yet’. After touching a record high around $317 earlier this month shares have retreated about 8.5% to around $291, with the stock –5% lower since Friday’s close before the WWDC event.

Siri AI – what’s the deal?

It’s all very clever, I’m sure. Is it better than rivals? Perhaps – the main question is whether you are going to stay with your iPhone or switch. On that front I cannot see enough from others to make people switch. I like the fact Apple put privacy at the heart of its AI architecture – this is something that people will value more and more. It uses Google Gemini models as a base and will use Nvidia chips run its most advanced AI model through Google’s servers.

Siri AI will launch in beta later this year for supported devices set to English - it will not be available in China or the European Union. That’s the first concern. The two markets make up about 35% of iPhone shipments over the last 12 months. I think shares sold off more on the lack of any concrete schedule for full release than a deeper worry about what the AI is like - this is a timing issue and a question about how ready they are. The launch in the autumn in the US should boost the upgrade cycle in Apple’s big domestic market, but the timing of launches in the EU and China will be material for shares in the medium term.

The key it seems is the upgrade cycle. Morgan Stanley reckons 850 million iPhones can’t run Apple Intelligence, while around 1.3 billion do not have the support for the most advanced version of Siri. Which it sees as a positive for upgrade cycles and increased iCloud adoption - 10% Services growth and mid-teens product growth in 2027: Morgan Stanley raised its price target to $360 from $330, with an Overweight rating. UBS, by contrast, said the AI features would not drive a meaningful iPhone upgrade cycle, sticking to its $296 PT.

Bank of America reiterated its $380 PT and Buy rating, saying it liked the privacy and highlighted the on-device processing and Private Cloud Compute as differentiators versus competitors.
Rate limits on image generation and photo generation should act as an immediate revenue lever as it forces iCloud upgrades and perhaps new tiers and pricing.

Forget AI, a foldable iPhone could be on the way

Maybe the focus on AI is missing a trick for a company that has based its success on the strength of its hardware and user operating systems. As long as the AI is good enough it may be more than enough for the stock.

In the last quarter, iPhone revenue rose 22% year over year to about $57 billion as the hot streak from the launch of the iPhone 17 continued. 

And in September, when Apple traditionally refreshes its tech lineup, we could get the first foldable iPhone coming with the iPhone 18 Pro and Pro Max. A foldable iPhone could command a considerable price tag, raising average selling prices.