Apple's stock edged higher on Thursday as investors weighed the company's expanding smart home ambitions and its broader artificial intelligence strategy ahead of the next earnings report. Shares of Apple (AAPL) gained 0.75% in regular trading, reflecting optimism about upcoming product launches and analyst commentary on AI-driven growth potential.
Smart Home Expansion with LG
Apple is set to host an event on October 13 in New York City titled "Welcome Home," where it is expected to unveil a new smart home hub with a screen, an updated HomePod mini, and a refreshed Apple TV set-top box, according to a Bloomberg News report. The company is also reportedly developing a range of smart home products in collaboration with LG Electronics, including a video doorbell, floodlight cam, indoor and outdoor cameras, a smart deadbolt lock, a smart thermostat, and a temperature sensor.
The LG-branded devices will be manufactured and supported by LG, with Apple likely providing integration with its HomeKit platform and Siri assistant. Regulatory filings with the US Federal Communications Commission and UL Solutions have been made, though the products are not expected to reach consumers for several months. Many of the devices support Wi-Fi, Bluetooth, Thread, and Matter protocols, and the smart lock includes ultra-wideband technology for automatic unlocking.
This move positions Apple and LG in closer competition with established smart home ecosystems from Amazon's Ring and Alphabet's Google Nest. Apple launched HomeKit in 2014, but the platform has struggled to gain significant traction compared to rivals. The new product lineup is part of a broader effort to reboot Apple's smart home strategy, which also includes a privacy-focused home monitoring device, a smart home hub with a robotic arm, and an in-home security monitoring service.
AI Strategy and Analyst Views
Wedbush analyst Dan Ives reiterated an Outperform rating on Apple with a $400 price target, arguing that the company's AI strategy could add approximately $75 per share to its valuation. Ives noted that AI could drive device upgrades and increase services revenue, potentially accounting for more than 15% of Services revenue over time. He also highlighted that about 375 million iPhones have not been upgraded in over four years, setting the stage for a strong iPhone 18 upgrade cycle. Additionally, Ives expects Apple's foldable iPhone Duo to generate demand, with sales estimates of around 10 million units over the next few quarters.
Citi also reiterated its Buy rating on Apple ahead of the company's earnings, expected in early November. The bank said investor attention will likely focus on Services growth momentum, ongoing weakness in App Store revenue, and concerns about the impact of agentic AI. Citi also pointed to gross margin pressure from higher memory costs, partially offset by higher average selling prices, as well as iPhone sales seasonality following the lack of a base-model launch this autumn.
The combination of smart home expansion, AI strategy, and the upcoming iPhone upgrade cycle gives investors several areas to watch as Apple approaches its next earnings report.
This article is for informational purposes only and does not constitute financial advice.
