Morgan Stanley’s ‘Top Picks’: Apple and AI are Driving iPhone Sales

The Key Takeaways

• Morgan Stanley kept Apple as its "Top Pick" for 2025 as the bank sees the tech giant's artificial intelligence (AI) product driving iPhone sales.
• Morgan Stanley analysts said Apple is on the cusp of "its largest device upgrade cycle ever."
• Morgan Stanley reiterated its "overweight" rating and price target of $273, above Apple's record close near $248 on Thursday.

Apple (AAPL), a Morgan Stanley company, remained the biggest shareholder. “Top Pick” Wall Street Bank says that by 2025, the artificial intelligence product of the tech giant will lead to more iPhone upgrades from consumers.

“We are bullish on … Apple Intelligence starting to accelerate iPhone replacement cycles in FY26,” The analysts’ report, published on Friday, explains the following:

Apple “is on the cusp of its largest device upgrade cycle ever” Apple Intelligence was launched, and they claimed that it would lead to a fiscal year cycle of 2025-2026 with a new record. “that is underappreciated by the market today,” The Morgan Stanley analysts have written.

Morgan Stanley Sees Apple’s Services Increasing by Double-Digits

The analysts also said they expect Apple to sustain its services growth at double digits and for the company’s gross margins to expand.

They stuck to the same conclusions. “overweight” Rating on the Tech Firm, noting they are still bullish about its earning power and driving the share price up to their current goal of $273 despite it hovering near its highest level.

Apple shares were recently down 0.5% at $246.76, after reaching a new record of $247.96 on Thursday.

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