Apple's (AAPL) Vision Pro broke new ground technically when it was launched two years ago. However, the roughly 22-ounce headset, originally priced at $3,499, has struggled to translate its impressive debut into major sales.
Following initial enthusiasm from early adopters, demand waned significantly, leading Apple to reportedly reduce production at the beginning of 2026, as IDC estimated Q4 sales at just 45,000 units. That sales slowdown now appears to have reached deeper into Apple’s workforce, with the company reportedly cutting roughly 200 jobs across its Apple Vision and Siri teams.
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About 100 employees from each segment face the chop, while Bloomberg’s Mark Gurman reports that Apple is largely eliminating its Vision Pro gaming team as part of broader reductions within the headset division. Apple is also trimming its Vision Pro immersive video team, which produces original content for the platform.
The company still plans to create fewer videos internally, while encouraging third-party companies to develop more 3D content for Vision Pro users. Despite those cuts, Apple could soon give consumers more ways to step into its wearable ecosystem, with a new range of smart glasses reportedly planned to challenge Meta Platforms's (META) Ray-Ban lineup sometime in 2027.
Apple has not officially confirmed the release timeline, but Gurman reports that the company is still exploring the possibility of releasing another Vision Pro model by the end of 2028 at the earliest.
Given this backdrop, Apple seems open to scaling back the Vision Pro project without abandoning its overall goals in spatial computing and wearables. The reshuffle could be more impactful if Apple effectively realigns its wearable efforts to focus on products that appeal to a wider audience.
About Apple Stock
Based in Cupertino, California, Apple designs, manufactures, and sells consumer electronics, software, and digital services across a remarkably broad ecosystem that includes iPhone, Mac, iPad, Apple Watch, AirPods, and Vision Pro.
With a market cap of $4.52 trillion, its platforms include iOS and macOS, while services such as iCloud, the App Store, Apple Music, and payments keep customers within its ecosystem.
That ecosystem has helped Apple turn customer loyalty into consistent financial performance. AAPL stock has gained 36.9% over the last 52 weeks, climbed 14.7% year-to-date (YTD), and advanced another 1% during the past three months.
www.barchart.com The catch comes with the price investors now pay for that momentum, since AAPL stock is trading at 35.54 times forward adjusted price-to-earnings and 10.92 times sales. Both figures sit above industry averages and their own five-year historical multiples, suggesting a premium.
Apple has also rewarded shareholders with a dividend that has grown for 13 consecutive years, with the company paying $1.08 per share annually at a yield of 0.35%. Its most recent dividend amounted to $0.27 per share, which Apple paid on Aug. 13 to shareholders of record as of Aug. 10.
Apple Surpasses Q3 Earnings
On July 30, Apple reported Q3 FY2026 results, with revenue and earnings beating Wall Street expectations. Revenue rose 16.4% year-over-year (YOY) to $109.4 billion, topping the $108.65 billion estimate, while adjusted EPS reached $1.91 against the Street’s $1.89 forecast.
The iPhone once again carried much of the quarter’s weight, with revenue surging 21.7% YOY to $54.3 billion as strong demand for the iPhone 17 lineup and market share gains gave Apple’s biggest business plenty of momentum. Mac added another pleasant surprise, generating $10.4 billion versus the $8.74 billion forecast.
Services also rose, with revenue increasing to $30.7 billion from $27.4 billion in the year-ago quarter, though the segment still fell short of the $31.22 billion estimate. iPad could not keep pace with the rest of the portfolio, as revenue slipped to $6.2 billion from $6.6 billion.
Moreover, gross margin climbed to $54.8 billion from $43.7 billion, producing a 50.1% rate. Tariff refunds helped Apple protect those margins, while operating income climbed to $35.7 billion from $28.2 billion in the prior year’s period. Net income also rose to $29.8 billion from $23.4 billion, giving investors plenty to like on the earnings front.
Still, Apple’s shares fell 7.35% in the following trading session as limited supplies of advanced semiconductor nodes restricted the company’s flexibility. Looking ahead, Apple expects supply chain constraints and rising memory costs to pressure the next quarter, forcing management to adopt a more cautious tone.
Hence, the management has guided for Q4 FY2026 revenue growth of 9% to 11%, down from June’s 16% pace, while a 2.5-point FX headwind and supply constraints could weigh on the iPhone, Mac, and iPad. And, Apple expects Q4 gross margin of 47% to 48%, with rising memory costs expected to offset one point of tariff refund benefit.
However, Wall Street expects the company to keep earnings moving in the right direction. Analysts expect Q4 FY2026 EPS to grow 7% YOY to $1.98. Full-year FY2026 EPS estimates sit at $8.76, implying 17.4% annual growth, while FY2027 estimates are projected to reach $9.52, adding another 8.7% growth.
What Do Analysts Expect for Apple Stock?
Following Apple’s latest earnings release, Bank of America analyst Wamsi Mohan reiterated his “Buy” rating and kept his $380 price target unchanged, showing that he still sees Apple navigating supply pressures, rising costs, and occasional product stumbles without losing its long-term growth trajectory or its stronghold on consumers.
That confidence broadly matches Wall Street’s view, which currently gives AAPL stock an overall "Moderate Buy" rating. Among 41 analysts covering the stock, 21 rate Apple a "Strong Buy," three give it a "Moderate Buy," 13 recommend "Hold," two assign a "Moderate Sell," while two analysts carry a "Strong Sell" rating.
To that end, the average price target of $328.62 represents potential upside of 5.7%. Meanwhile, the Street-High target of $400 from Rothschild Redburn analyst Timm Schulze Melander points to a gain of 28.7% from current levels. He sees Apple’s massive installed base, high-margin Services business, AI strategy, and premium foldable iPhone as key growth drivers.
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www.barchart.com On the date of publication, Aanchal Sugandh did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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