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Apple (AAPL) held its live “Awe Dropping” event yesterday, Sept. 9, where it unveiled the new iPhone 17 along with upgrades to other products, which will go on sale next month. As was the case with the Worldwide Developer Conference (WWDC) in June, the “Awe Dropping” event turned into a “stock dropping” event for AAPL.
Apple announced the new generation of iPhones, including the thinnest iPhone ever, at the event, which CEO Tim Cook termed the “biggest leap ever for iPhone.” However, as was the case with this year’s WWDC, markets didn’t share Apple management’s enthusiasm and most analysts saw the improvements as incremental instead of being truly pathbreaking. Yesterday’s event only strengthened the narrative that Apple is lagging in artificial intelligence (AI) even as its Big Tech peers are racing ahead. In this article, we’ll look at the key highlights of Apple’s event and examine what’s been plaguing AAPL stock this year.
Apple Announces the Thinnest-Ever iPhone
Apple announced four new iPhone models at the event. The entry-level iPhone 17 is priced at $799, while the top-end iPhone 17 Pro Max will start at $1,199, the same price as their predecessors. The company, however, raised the iPhone Pro price by $100, so the iPhone 17 Pro will start at $1,099 Apple also introduced the iPhone 17 Air, starting $999. The model is the thinnest iPhone ever, based on the new titanium body, and will come with up to 24 hours of battery life.
Apple Watch also got a new upgrade and will come with hypertension monitoring capabilities. AirPods Pro 3 will have a live translation service with better audio quality and noise cancellation. The prices for both these products are the same as their previous generations.
Apple’s AI Gap And Valuation Concerns
During Apple’s fiscal Q3 2025 earnings call, Cook termed AI “one of the most profound technologies of our lifetime.” Separately, at an all-hands meeting, Cook is said to have termed AI an opportunity as big as the internet while emphasizing, “Apple must do this. Apple will do this. This is sort of ours to grab.”
There is an AI war out there, and other tech giants have significantly increased their AI capex while also doubling down on inorganic growth through acquisitions. We also have a talent war where Meta Platforms (META) has particularly poached AI talent from other companies with eye-popping compensation.
Despite Apple talking about the AI opportunity multiple times and Cook even touting the possibility of a major acquisition in that space, the company’s AI initiatives have failed to impress, and there is a glaring “AI gap” with other tech companies. Many have called for Cook’s ouster amid concerns that Apple is losing out on the AI revolution under him
There are valid questions over whether Apple really deserves to trade at premium valuations, and many find its forward price-earnings (P/E) multiple of 32.4x a bit too high for comfort, especially given the tepid top-line and bottom-line growth in recent quarters. While Apple Intelligence features were expected to spur a replacement cycle for iPhones, that hasn’t exactly been the case over the last year.
Is Apple Stock a Buy?
Appe has never been the first mover, and it strives for perfection over speed. As Cook reportedly told employees, “We’ve rarely been first. There was a PC before the Mac; there was a smartphone before the iPhone; there were many tablets before the iPad; there was an MP3 player before iPod.”
There is little denying that Apple, just like Tesla (TSLA), was not the first mover. However, these companies went on to lead in their respective industries, led by innovative and appealing products and strong brands.
One of the reasons Apple is visibly running behind in AI is the company’s focus on privacy, which is atypical in a technology era that feeds on massive amounts of data. Apple continues to highlight privacy as the unique selling point of its AI features and said that it is investing in private cloud compute, including in its own data centers.
All said, I continue to stay invested in Apple and don’t fully share the pessimism that the company has lost out in AI. Apple remains a “show me” story, and a lot will now rely on how iPhone 17 sales shape up. If iPhone 17 sales also disappoint, I will revisit my investment case for Apple, which I had originally planned to “hold for a lifetime.”
