Apple is about to release its quarterly results for the third quarter of 2025. Expectations are cautious, but not negative. The iPhone business, in particular, appears to have stabilized. Analysts anticipate moderate growth. No major leaps are expected, but no setbacks either.
Apple, the tech giant, faces several challenges this year: increasing competitive pressure in the AI sector, geopolitical uncertainties impacting supply chains, and rising import tariffs. Nevertheless, iPhone sales remain stable, and the company remains cautious in its communications strategy, as usual. Analysts such as Gene Munster and Brian Baker of Deepwater Asset Management provide their preliminary assessment of the current situation.
iPhone business stabilizes slightly
Apple will present its results for the third fiscal quarter of 2025 on July 31. Analysts expect the figures to be solid. The iPhone business, in particular, is showing stability. Sales are expected to have increased by 2.1 percent compared to the same quarter last year. By comparison, the second quarter saw an increase of 1.9 percent. According to Deepwater, the average growth over the last three quarters is 2.2 percent. Therefore, analysts consider the current expectations of a 0.8 percent sales decline to be too pessimistic. A moderate improvement compared to the September quarter seems realistic.
AI race remains open for now
In the field of artificial intelligence, it doesn't appear that any vendor has a clear advantage yet. There is still no truly groundbreaking AI feature on the smartphone market. Despite its comparatively slow progress in Apple Intelligence, Apple is not currently losing any decisive ground to its Android competitors. During this year's WWDC developer conference, Apple deliberately set the bar for AI. A key innovation for Siri has been postponed. For investors, this means that no revolutionary innovations in voice assistance can be expected in the next twelve months.
- This also means that if Apple redesigns Siri, it has to be spot on. Expectations for this redesign are particularly high right now. Analysts say this upgrade must be a true innovation to be successful.
No takeover of Perplexity in sight
In recent weeks, there has been speculation about a possible acquisition of the AI startup Perplexity by Apple. However, the likelihood of a deal has decreased significantly. One reason for this is the financing round completed in July, which valued Perplexity at $1.8 billion. This high valuation tends to argue against the possibility of takeover talks with Apple currently taking place. Nevertheless, analysts still see potential in such a deal – even at a higher price. An acquisition would help Apple develop its own AI models more quickly and could also be relevant for entering the search engine market in the medium term. This topic was last highly controversial at the end of 2024, but remains on the agenda.
Tariffs put pressure on the balance sheet
Another issue in the current fiscal year is the impact of import tariffs. The trade conflict between the US and China is causing particular strain. CEO Tim Cook has stated that Apple expects to pay $900 million in tariff-related costs in the third quarter. This figure has unsettled investors. Nevertheless, Apple is sticking to its typical approach and is not providing forecasts for the coming quarters. Deepwater views this behavior as standard practice – not as an attempt to withhold information. Apple strictly adheres to internal guidelines in its communications. In terms of its operations, Apple is proving resilient. Supply chain management already helped cushion the impact of the tariffs at the beginning of 2025. This should also help in the coming months. Analysts believe that the actual consequences for Apple may be less severe than feared. At the same time, talks are underway between the US and China, in which a de-escalation of the tariffs is on the table. This could provide relief in the medium term.
iPhone 17 Air as the next hope
For the coming fiscal year, attention is already turning to the next product generation. The iPhone 17 Air is considered a key device in the next cycle. Apple is relying on a new form factor. This has often provided growth momentum in the past. One example is the iPhone 6 Plus, whose larger display led to a sales surge in 2015. Back then, annual growth rose to 52 percent, compared to just 12 percent the previous year. While double-digit growth is not expected for the iPhone 17 Air, the current forecasts of 5.7 percent could still be revised upwards, according to Deepwater. The market is therefore expecting a decent, if not spectacular, cycle.
Apple calmly navigates a difficult environment
Apple is expected to deliver solid results in the third quarter of 2025. The iPhone business remains stable, with a moderate but positive growth rate. In the AI sector, no clear market leader has yet emerged. Apple is not far behind its competitors here. A planned acquisition of Perplexity appears to be off the table, but remains strategically interesting. Import tariffs pose a short-term risk, but Apple is addressing this with efficient supply chain management. The outlook for the coming iPhone cycle is cautiously optimistic. The iPhone 17 Air could become a key growth driver, even if a major leap like in 2015 is not in sight. Overall, Apple remains stable and strategically capable in a challenging market environment. (Image: Shutterstock / Lena Chert)
Disclaimer: No recommendation for investments
This article does not constitute financial or investment advice. The information contained herein is for journalistic and informational purposes only. Please conduct your own research or consult a financial advisor before making any investment decisions.
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