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Last Updated: March 10, 2025 at 7:18 p.m. ETWall Street had a rough start to the week, and Apple Inc. (AAPL) was at the center of the storm. The tech giant’s stock experienced its worst single-day drop since September 2022, falling nearly 4.85% on Monday. This decline outpaced the broader Nasdaq Composite index, which dropped 4%, and contributed to a 71-point drag on the Dow Jones Industrial Average.

Apple stock performance chart 2025
Apple’s stock performance over the past year. Source: Getty Images

As an avid follower of tech trends and market movements, I’ve been keeping a close eye on Apple’s recent struggles. Here are the two major concerns that have investors worried:

1. Delayed AI Features for iPhone

One of the biggest disappointments for Apple investors is the delay in AI-powered upgrades to Siri, the company’s voice assistant. According to a report by Bloomberg, Apple has pushed back the release of its highly anticipated AI features, which were originally slated for April 2025 as part of the iOS 18 update.

Citi analyst Atif Malik highlighted this delay in a recent note to clients, stating that the upgraded Siri—with features like on-screen awareness, personal context, and deep app integration—would have driven a significant iPhone refresh cycle. Malik now expects iPhone sales growth for 2025 to be just 2%, down from an earlier estimate of 5%.

Why This Matters:

  • The delay could slow iPhone upgrades, impacting Apple’s revenue.
  • Competitors like Google and Microsoft are advancing rapidly in AI, potentially leaving Apple behind.
Siri AI upgrade delayed
Apple’s Siri AI upgrade has been delayed. Source: Getty Images

2. Looming Tariff Threats

Another major concern for Apple is the impact of tariffs on its manufacturing and sales. Currently, about 90% of Apple’s products are manufactured in China, and 40% of its sales come from the U.S. If Apple fails to secure tariff exemptions, Malik estimates a 1.7-point drag on the company’s gross margins.

This could force Apple to raise iPhone prices to offset the additional costs, which might further dampen consumer demand.

Why This Matters:

  • Higher prices could make iPhones less competitive in key markets.
  • Tariffs could squeeze Apple’s profitability, especially in a challenging economic environment.
Impact of tariffs on Apple
Tariffs could impact Apple’s profitability. Source: Getty Images

What’s Next for Apple?

Despite these challenges, Citi maintains a buy rating on Apple’s stock with a price target of $275. However, Malik has trimmed his earnings estimates for fiscal 2025, 2026, and 2027 by about 1%.

As someone who’s been analyzing the tech industry for years, I believe Apple’s ability to navigate these hurdles will depend on its innovation pipeline and strategic decisions in the coming months.

Key Highlights

  • Apple’s stock fell 4.85%, its biggest drop since September 2022.
  • Delayed AI features for Siri could slow iPhone sales growth.
  • Tariffs may lead to higher iPhone prices and lower profit margins.

FAQs

1. Why did Apple’s stock drop significantly?

Apple’s stock dropped due to concerns over delayed AI features for Siri and the potential impact of tariffs on its manufacturing and sales.

2. What are the delayed AI features for Siri?

The delayed features include on-screen awareness, personal context, and deep app integration, which were expected to enhance Siri’s capabilities.

3. How could tariffs affect Apple?

Tariffs could increase manufacturing costs, forcing Apple to raise iPhone prices and potentially reducing its profit margins.

4. What is Citi’s outlook on Apple’s stock?

Citi maintains a buy rating on Apple’s stock with a price target of $275 but has trimmed its earnings estimates for the coming years.

5. How does this impact iPhone consumers?

Consumers may face higher iPhone prices and delayed access to advanced AI features.