Apple shares dropped 2% to $307 on Monday after Jefferies analysts downgraded the stock to “underperform,” citing the reported cancellation of a premium all-glass iPhone model that was expected to drive future revenue growth.
Supply Chain Concerns Trigger Downgrade
Analysts at Jefferies slashed their price target for Apple (AAPL) from $286 to $264, pointing to supply chain indicators suggesting that the tech giant has scrapped plans for an all-glass iPhone. The firm characterized this development as a significant hurdle for Apple’s strategy to introduce higher-priced hardware to offset rising memory component costs.
Market Reaction and Recent Performance
This decline extends a recent cooling-off period for Apple stock, which had previously surged to make the company the world’s most valuable—briefly overtaking Nvidia (NVDA). Despite exceeding earnings expectations last month, Apple shares have struggled to maintain momentum following a disappointing revenue forecast.
The Impact of the Canceled Anniversary Device
According to Jefferies, the all-glass device was intended to be the centerpiece of the iPhone’s 20th-anniversary celebration next September. The model was projected to retail for over $2,000. The design was expected to eventually integrate into the Pro and Pro Max lineups, serving as a critical buffer against the escalating costs of memory technology. Apple has not yet responded to requests for comment regarding these claims.
Is the Foldable iPhone the New Strategy?
With the all-glass project reportedly off the table, analysts suggest Apple may now be forced to lean heavily on its upcoming foldable iPhone to justify price hikes. However, experts caution that the high cost of production and retail pricing could relegate the foldable model to a “niche product” rather than a mass-market revenue driver.
Wall Street Sentiment
The downgrade from Jefferies aligns with two other analysts tracked by Visible Alpha who maintain a cautious outlook. Despite this, the broader consensus remains optimistic, with four other analysts maintaining a “buy” rating. The current mean price target of $330 represents an approximate 8% upside from Monday’s trading levels.