As of June 26, Apple (NASDAQ: AAPL) is the worst-performing stock in 2025 among the Magnificent Seven, with a total return of approximately -20%, slightly trailing Tesla (NASDAQ: TSLA) at -19%. The company’s challenges have been attributed to trade wars and lackluster AI initiatives, making 2025 a tough year for the iPhone maker.
Apple’s product revenue for the past 12 months is stagnant at $298 billion, while services revenue rose to $102 billion, up 50% from fiscal 2021. The company has managed to increase its operating margin from 29.8% in fiscal 2021 to 31.5% in fiscal 2024, largely due to its services segment. Despite a cumulative adjusted earnings per share (EPS) growth of 20% over this period, Apple stock has only yielded a 15% total return since the end of 2021, which is less than half of the S&P 500’s performance.
Apple plans to invest $500 billion over the next four years to enhance its AI capabilities, aiming to address its lag in the AI sector. Speculation surrounds a potential acquisition of AI startup Perplexity to bolster its competitive edge, although critics argue this alone might not suffice to revolutionize its AI offerings.
