Apple Just Leaked Its AI Future. Investors Have More Reasons to Worry.

A leaked video just gave the world an early look at Apple’s (AAPL) next big bet. It showed AirPods with a built-in camera that can see the world around you and feed what it sees to Siri. In the clip, someone holds a book up to the earbuds, and Siri reads the cover to identify it. The video was accidentally buried in a Mac software update, and it sparked hope that the product was arriving soon. Then Bloomberg reported that it isn’t. Apple continues to be held back by supply-chain and software problems, and is therefore still targeting 2027. 

That delay is the real story, because it isn’t the first time. Let's take a closer look.

A Pattern Apple Can’t Seem to Shake

These AirPods were originally meant to launch in 2026. They slipped to 2027 mainly because Apple struggled to build the visual AI models that let the earbuds recognize what they’re looking at. If that sounds familiar, it should. As I covered previously, Apple’s revamped Siri was delayed by more than a year for similar reasons, and the version now rolling out is powered by Alphabet's (GOOGL) Google Gemini AI. The camera AirPods depend on the same underlying technology, so when the AI runs late, the hardware does, too.

This is exactly what investors have been worried about for the longest time with Apple. The company’s core business has rarely looked healthier. It just posted its strongest June quarter ever, with revenue up 16% to $109 billion. Yet the market keeps discounting AAPL stock. Investors fear that Apple has fallen behind in AI while rivals race ahead. Every delay tied to AI increases that concern. 

The leaked AirPods are a reminder of both sides of Apple’s story. The vision is there — a future where AI wearables do what you now pull out your phone for. But the timeline keeps depending on the part Apple has been slowest to deliver. Until Apple proves it can ship its AI features on schedule, moments like this leak will continue to raise questions.

About Apple Stock 

Apple is a technology company that designs and sells products such as iPhone, Mac, iPad, the Apple Watch, AirPods, and other accessories worldwide. It also provides digital services including iCloud, the App Store, Apple Music, Apple TV, and more. Apple sells its products through its own stores and website, as well as carriers, retailers, and other partners. The company was founded in 1976 and is headquartered in Cupertino, California. 

Year-to-date (YTD), AAPL stock has increased 15%, outperforming the S&P 500’s ($SPX) 12% gain during the same period. Apple’s strong YTD performance has been supported by robust iPhone and Mac demand, solid earnings growth, and continued strength in its high-margin Services business. Investor optimism around Apple’s massive installed base and long-term AI opportunities has also supported the stock. AAPL stock has been fairly volatile, climbing from roughly $275 in late June to $340 by July 28 before falling back near the $310 level today.

Apple’s valuation sits at a clear premium to its own history. The forward price-to-earnings (P/E) ratio of 35.5 times comes in above its five-year average of roughly 29 times. Similarly, the price-to-sales (P/S) ratio of 10.9 times sits above the five-year average of 7.5 times. So, even as investors worry the company is behind on AI, they’re paying up due to Apple's quality and cash generation.

The earnings outlook is steady rather than spectacular. Analysts expect growth of 17% in fiscal 2026 followed by 9% growth in fiscal 2027. That’s decent for a company of this size. However, it isn’t the kind of acceleration that completely justifies paying well above historical norms. Meanwhile, the balance sheet isn’t much of a concern. The company holds $62 billion in cash against roughly $84 billion in debt. For a company worth trillions of dollars, the net debt of $22 billion seems rather insignificant.

Overall, the premium makes sense if Apple’s AI features eventually land and get people buying new iPhones again. But if the delays keep coming, investors may no longer feel comfortable paying up. 

Strong Q3 Growth, Softer Q4 Outlook

Apple announced its third-quarter fiscal 2026 earnings on July 30. The company reported a stronger-than-expected quarter with revenue of $109.4 billion, up 16% year-over-year (YOY). Products revenue was $78.7 billion and Services revenue was $30.7 billion. EPS came in at $2.02, up 29% YOY and beating the Wall Street consensus estimate of $1.89. Gross margin was 50.1%, while operating cash flow stood at $34.4 billion, a June-quarter record. 

Looking forward, Apple guided for September-quarter revenue growth of 9% to 11% YOY. The company expects reported rate growth for iPhone to be in the mid-teens YOY. However, for Services, management expects the growth rate to be largely similar to what it reported in the June quarter after removing the negative sequential impact of about 2.5 percentage points from foreign exchange. Operating expenses are expected to be between $19.1 billion and $19.4 billion. Beyond the quarter, Apple pointed to a broad product roadmap, including its new Siri AI features, which the company expects to help drive demand during the holiday season. Moreover, Apple said it is working on regional rollouts for Europe and China.

What Do Analysts Expect for AAPL Stock?

Bank of America Securities recently reiterated a “Buy” rating on AAPL stock and assigned a price target of $380. The firm believes Apple became one of the world’s most valuable companies under CEO Tim Cook by growing its user base, expanding high-margin services, focusing on privacy, and consistently launching new products. BofA expects incoming CEO John Ternus to continue this strategy while creating additional growth opportunities through AI features, new products, and continued share buybacks. Rothschild & Co Redburn also recently upgraded AAPL stock to “Buy” from “Neutral” with a price target of $400. In contrast, however, Jefferies downgraded AAPL stock to “Underperform” from “Hold” with a price target of $263.66. 

Based on 41 Wall Street analysts with coverage, Apple stock holds a consensus “Moderate Buy” rating. Out of those analysts, 21 have a “Strong Buy” rating, three have a “Moderate Buy” rating, 13 have a “Hold” rating, two have a “Moderate Sell” rating, and two have a “Strong Sell” rating. The average price target of $328.62 sits just above current levels, implying potential upside of 5% from here. Apple stock has a high price target of $400 and a low price target of $240 per share.