Apple Inc. shares fell more than 1% during Thursday's morning session, trading at $272.42 as the technology giant underperformed broader U.S. market indexes. The decline came despite fresh data showing Apple was the only major smartphone brand to achieve sales growth in China during January.
China Performance Provides Silver Lining
Counterpoint Research reported Chinese smartphone sales dropped 23% year-over-year in January, yet Apple managed to buck this trend with an 8% increase. The iPhone 17 series continued to attract buyers in the challenging market environment, providing a rare bright spot for investors.
Regulatory and Cost Pressures Mount
Investors balanced the positive China data against growing regulatory concerns. The U.S. Federal Trade Commission has raised questions about potential bias in Apple News content distribution, warning such practices could violate federal regulations if they contradict company policies or user expectations.
Meanwhile, rising component costs have prompted concerns about potential margin pressure in coming quarters. Bernstein analyst Mark Newman raised his price target to $340 from $325, citing Apple's artificial intelligence initiatives and better positioning to handle increased memory costs compared to peers.
Macroeconomic Factors in Focus
Market attention now turns to Friday's Consumer Price Index report, which economists expect to show headline inflation slowing to 2.5% annually. Higher-than-anticipated inflation could pressure bond yields and compress price-to-earnings multiples for premium growth stocks like Apple.
Looking ahead, Apple's virtual annual shareholder meeting on February 24 will provide investors with updates on corporate strategy and governance. The company's ability to maintain Chinese market share and promote its "Apple Intelligence" features as upgrade drivers will be closely monitored.
