Apple Growth, Margins Likely Face Pressure in 2027, UBS Says

03:00 PM EST, 11/03/2026 (MT Newswires) -- Apple (AAPL) growth and margins are likely to come under pressure in fiscal 2027 amid slowing Services revenue and higher component costs, UBS said in a note Monday. The report said December-quarter Services revenue growth is expected to slow to 8% to 9% from 10% in Q4, as AI tools seem to cannibalize Google search activity quarter-over-quarter. Gross margin is expected at 45% to 46%, down from 48.2% a year earlier, as memory costs rise, tariff benefits fade and Siri AI development expenses increase, the report said. "Although a one- or two-percentage-point revenue growth slowdown has little impact on EPS, it will likely weigh disproportionately on Apple's valuation multiples," the note said. With Siri AI ramp costs weighing on December-quarter margins and AI strategy still appearing nascent, the note said its multiple is expected to compress to some 31 times from 36 times. UBS maintained its neutral rating while raising its price target to $340 from $296. Price: 332.18, Change: -6.14, Percent Change: -1.81