Can AI Push and iPhone 17 Reverse the Lagging Stock Performance For Apple?

As the broader tech market continues its bull run, Apple, once the undisputed king of Wall Street, is facing a challenging year. The company's stock has notably underperformed its "Magnificent Seven" peers in 2025, leaving investors to wonder if its upcoming AI innovations and the much-anticipated iPhone 17 can help it regain its momentum.

While AI-centric companies like Nvidia and Microsoft have seen their valuations soar, Apple's shares have posted more modest gains, weighed down by concerns over slowing iPhone sales and a perception that the company has been late to the generative AI party.

But now, with the recent launch of its new product lineup and a clearer AI strategy, the trillion-dollar question is: can Apple close the gap?

The AI Strategy Takes a Front Seat
The core of Apple's comeback narrative rests on its newly unveiled AI strategy, internally codenamed "Project Greymatter." Unlike its competitors who have focused on flashy, cloud-based chatbots, Apple is betting on a more integrated, on-device approach that prioritizes privacy and practical utility.

Key features rolled out with iOS 19 and the new iPhone are central to this plan:

A Revamped, Smarter Siri: Powered by a combination of Apple's own on-device models and a potential partnership with a major AI lab like Google Gemini, Siri is finally becoming the intelligent, context-aware assistant users have long desired.

Proactive Intelligence: The new operating system is designed to learn user habits and proactively assist with tasks, from summarizing notifications to suggesting email replies.

The Power of the A19 Bionic Chip: The chip powering the new iPhone 17 lineup features a significantly more powerful Neural Engine, designed to handle these complex on-device AI tasks with speed and efficiency.

Wall Street is watching closely to see if these practical, privacy-focused AI features will resonate with consumers and drive a new wave of upgrades.

All Eyes on iPhone 17
Ultimately, Apple's fortunes are still inextricably linked to the iPhone. While the iPhone 16 offered incremental improvements, analysts are looking to next year's iPhone 17 as the next major "supercycle."

Rumors and analyst expectations for the iPhone 17 include a significant redesign, major camera advancements, and an even deeper integration of the new AI capabilities. The success of this device will be a critical test of whether Apple can reignite the explosive growth that investors have come to expect.

The consensus on Wall Street is one of cautious optimism. Many believe that Apple's massive, loyal user base and its deliberate, ecosystem-focused approach to AI will pay off in the long run. However, the pressure is on. For Apple's stock to reclaim its "magnificent" status, the company must prove that its thoughtful approach to AI can translate into the kind of must-have products that will once again send customers flocking to its stores.