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Here’s a Sneak-Peak of Apple’s Annual Developer Conference
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Here’s a Sneak-Peak of Apple’s Annual Developer Conference

Story Highlights

At the week-long annual developer conference starting today in Cupertino, California, CEO Tim Cook is expected to give out details on the latest versions of Apple’s software as well as disclose its strategy for its software over the coming months.

Apple (AAPL) is all set to kick-off the Worldwide Developers Conference (WWDC) to unveil the latest versions of Apple’s software for iPhones, iPads, Macs, Apple Watches, and TVs, as well as disclose its strategy for its software over the next 12 months.

In a hybrid event, CEO Tim Cook will begin the keynote address, scheduled to begin at 1 p.m. in New York, via the company’s website. A few hundred software developers, students, and members of the news media will be present in person at the company’s headquarters in Cupertino, California.

The hybrid meeting comes as a sharp contrast to when over 6,000 participants were physically present at the WWDC in the pre-pandemic world. Due to the COVID-19 situation, Apple transitioned to completely virtual events during the last two years.

At the time of writing, shares of the tech giant have gained almost 2% during the pre-market trading session today, in anticipation of the announcements at WWDC.

What to Expect

CEO Tim Cook is expected to give out details on the latest versions of its software for the iPhone, iPad, and computers, as well as on the new software features and policies.

There could be a variety of new announcements for the newly updated software for iPhones and iPads, and iOS 16. The company may lay out the details of the new design, better notifications, and improved updates and seek developers’ thoughts and reactions on the same.

Apple management may also give out details on the upcoming launches during the second half of the year, including the new phone, a new version of its MacBook Air laptop, and the much-awaited extended-reality headset launch.

For the current year, Apple is expected to see better growth in the services category, which includes revenues from the App Store and Apple’s ad business, compared to the sales generated from the iPad and Mac computers.

Wall Street’s Take

Ahead of the conference, Morgan Stanley analyst Kathryn Huberty reiterated a Buy rating on the stock, with a price target of $195 (34.13% upside potential).

However, Huberty cautioned regarding a potential slowdown in the growth rate for the App Store’s overall services revenue in the current quarter.

She thinks that “her 15% growth forecast for June quarter App Store revenue growth could prove substantially too high.”

Overall, consensus among analysts is a Strong Buy based on 21 Buys and six Holds. The average Apple price target of $186.45 implies 28.25% upside potential from the current levels.

TipRanks’ Smart Score

APPL scores a 9 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

Concluding Thoughts

Amid rising global uncertainty and a slowdown in gadget sales worsened by rising inflation, investors remain worried whether the record profitability at Apple seen during the pandemic years, when workers and students increasingly bought laptops, iPhones, and tablets, is sustainable or not.

Another cause of concern is the possible slowdown in iPhone sales due to a shortage in parts and factory shutdowns in China due to the resurgence of COVID-19 in the region.

Investors will closely look for any positive signs, and they will be all ears when CEO Tim Cook speaks at the conference this week.

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