UBS has increased its Apple price target to $287 per share from $280 as the firm prepares for Apple’s upcoming quarterly results. Despite the higher target, the bank kept a Neutral rating, saying the change reflects recent shifts in device market dynamics rather than a change in its medium-term view.
For the March quarter, UBS expects a slight beat versus consensus, projecting revenue of $109 billion compared with a VA consensus of $109.3 billion. The bank describes any modest upside as primarily coming from iPhone and Mac demand.
UBS projects iPhone revenue of $56.2 billion for the quarter, citing supply-chain checks and sell-through data that point to a modest level of outperformance. On the Services side, the firm does not anticipate upside relative to its roughly 14% revenue growth forecast, noting that strength in payments is being offset by muted growth in the App Store.
The firm’s consolidated gross margin forecast for the March quarter is 48.5%, and UBS expects diluted earnings per share to finish a few cents above its $1.94 estimate.
The more substantive revisions in UBS’s note concern the June quarter. The bank raised its June revenue forecast by roughly 4% to $102 billion, which implies 8.5% year-over-year growth. A key driver of that revision is what UBS labels "memory driven share gains," prompting an increase in its iPhone unit forecast to 50.3 million units from 46.5 million units.
UBS sees Apple taking share from Android devices in important markets, including China and Europe. At the same time, the firm flagged that higher memory costs will compress product margins both sequentially and year-over-year. For the June quarter, UBS guided to a gross margin range of 47% to 48% and raised its EPS estimate by about 7% to $1.70.
Overall, UBS’s update tightens certain near-term revenue and unit expectations while also flagging margin pressure from rising component costs. The bank’s changes emphasize a mix of stronger hardware volume assumptions for the June quarter alongside cost-driven margin moderation.