Optimistic analysts share the opinion that a major iPhone upgrade cycle is coming thanks to software updates from Apple Intelligence.

Apple announced Apple Intelligence, its genetic AI software, in June. Wall Street was excited that these updates would lead to a surge in upgrades since only newer iPhone models can run the software. However, Apple Intelligence's official launch didn't happen until Monday, just over a month after the iPhone 16 hit stores. All software functions are not yet fully available, but will be introduced in the coming months.

Despite Apple Intelligence's lengthy rollout, optimistic analysts still believe the software will drive demand for devices that can run it.

“We expect strong iPhone performance for the September quarter and relatively bullish commentary on iPhone demand in December from Cook & Co., although many of the bears recently roared fire in a crowded theater over the strength of iPhone 16 sales,” said Wedbush analyst Dan Ives wrote in an Oct. 27 note. He rates the stock an “Outperform” with a $300 price target.

There are some bulls who disagree that the December quarter forecast will be strong. This includes TD Cowen analyst Krish Sankar, who rates Apple a “buy” with a price target of $250.

“AAPL stock sentiment ahead of September 24 (F4Q24) results is significantly negative due to C2H24 iPhone 16 builds coming in slightly below 15 year-over-year, weak demand in China and regulatory risks to the services business “, he wrote. He expects the company to provide guidance for the December quarter that is either in line with or below expectations.

Meanwhile, Barclays analyst Tim Long rates the stock as underweight with a price target of $186.

“We do not expect a major AI cycle as current AI capabilities are not differentiated and our analysis of past iPhone cycles suggests there will not be a major upgrade cycle,” he wrote.