Chips Are Selling Off and Apple Just Hit a New High. What Splits the AI Trade

Chip stocks just had a rough week, and Apple (NASDAQ:AAPL | AAPL Price Prediction) kept going up. The stock trades at $342.96. The 24/7 Wall St. price target for Apple is $397.78 over the next 12 months, which means 15.99% upside. The stock wins a buy rating with high confidence.

24/7 Wall St. Price Target Summary

The AI trade has split in two. Chipmakers get paid while hyperscalers keep spending on AI infrastructure (we covered seven of the suppliers driving that expansion, from power to cooling, in a free report you can grab here).

Apple wins from AI by selling it across more than 2.5B active devices in its existing customer base. When investors start questioning infrastructure spending, that installed base looks like the safer place to be. Apple is also posting real growth: revenue rose 16.4% year over year last quarter.

Apple Climbed While Semiconductors Fell 13% in a Week

Over the past week, the iShares Semiconductor ETF (NASDAQ:SOXX) dropped 13.31%. Apple rose 2.11% over the same period. Apple is up 3.22% over the past month and 26.81% year to date. It sits about 1.5% below its 52-week high of $348.15.

Fiscal Q3 EPS of $2.02 beat the $1.89 estimate, Apple’s 9th consecutive beat. Revenue came in at $109.42B. More recently, Apple drew attention for a new home hub.

Why Siri AI Could Push Apple Toward $450

The bull case hits $451.56. Siri AI is the main driver. Cook said Apple is “off the charts excited about Siri AI”, and he pointed to paid iCloud Plus upgrades as a way to make money from it.

Apple already has more than 1.5 billion paid subscriptions. Supply shortages also came from demand running ahead of forecasts. Among analysts covering the stock, 6 rate it Strong Buy and 19 rate it Buy.

Memory Costs and a Lagging Consensus Are the Risks to Watch

The bear case is $337.47. The consensus analyst target of $329.38 already sits below the current price, and 6 analysts rate the stock Sell or Strong Sell. Cook called memory pricing “a 100-year flood”.

Guidance calls for gross margin of 47% to 48%. Tariff refunds were a one-time boost of $0.11 to EPS. Even so, Apple said EPS still set a June-quarter record even when excluding the tariff refund benefit.

Apple Trades at NVIDIA’s Multiple With Less Spending Risk

This comparison includes Microsoft (NASDAQ:MSFT) because it is a mega-cap that monetizes AI through software. Its Azure revenue grew 43%. Quarterly capex, however, rose 109.63% and free cash flow fell 23.19%. Microsoft’s P/E of 30 looks cheaper, but Apple’s premium comes with much lower infrastructure spending.

NVIDIA (NASDAQ:NVDA) is the clearest example of the chip side of the trade. Revenue grew 105.85%, yet the stock fell 8.91% over the past week. The two stocks trade at almost the same P/E. Next to these peers, our target looks reasonable.

Siri AI and Memory Costs Will Decide Apple’s Next Move

The 24/7 Wall St. price target of $397.78 has a buy rating and high confidence. What convinces me is earnings growth that does not depend on AI capex.

The upside case improves if Siri AI raises upgrades and iCloud Plus subscriptions. The outlook weakens if memory costs keep pressuring gross margin below guidance. On balance, Apple’s earnings growth has less exposure to AI infrastructure spending than its peers.

Apple Price Prediction 2026-2030

Looking further out, the 24/7 Wall St. price target model projects where Apple could trade if current trends hold.

The estimates assume Apple keeps executing on its current strategy. The results could move sharply higher or lower depending on how Siri AI is adopted, how memory costs trend, and how regulators in the EU and China rule.

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