Bernstein: Apple Gross Margin Under Pressure, Market May Have Underestimated Medium-to-Long-Term Logic

TechFlow news, According to TechFlow Research, Bernstein's research report on July 31 showed that Apple's third-quarter revenue was $109.4 billion, a year-on-year increase of 16.4%, actual earnings per share was $1.91, slightly exceeding the market expectation of $1.89. Excluding the impact of tariff rebates, the actual gross margin was 48.1%, at the midpoint of the guidance. The revenue growth guidance for the fourth quarter was lowered to 9% to 11%, gross margin guidance was 47% to 48%, a quarter-on-quarter compression of approximately 160 basis points, with rising memory costs being the core drag. iPhone revenue was $54.3 billion (up 22%), Mac revenue was $10.4 billion (up 29%), both exceeding expectations. Services revenue was $30.7 billion, up 12% year-on-year, lower than the expected $31.4 billion.

Bernstein maintained its Outperform rating, raising the target price from $350 to $370, corresponding to approximately 33 times earnings per share for fiscal year 2028. Memory inflation is expected to continue for several more quarters, but Apple's market share is expanding, and the AI-driven upgrade cycle is the long-term logic. Bernstein judges that the market's concerns about short-term memory costs are excessive, underestimating Apple's medium-to-long-term value.