Apple Inc's (NASDAQ:AAPL, ETR:APC) China strategy is taking shape, and Wall Street is taking notice. Wedbush says the company’s long-awaited AI rollout in the country is finally moving forward, with Alibaba playing a key role.
Last week, Apple unveiled its plan to bring Apple Intelligence to China, a market that has become increasingly challenging.
Unlike in the US, where Apple uses its own AI infrastructure and partners with OpenAI, China’s strict regulations forced the company to find a local cloud partner. With Alibaba now in the picture, Wedbush believes Apple Intelligence will launch in China by June.
This is a big deal for Apple. Wedbush estimates that over 100 million iPhones in China are due for an upgrade.
With Huawei gaining ground, Apple needs a strong selling point, and AI-powered features could be the answer. Wedbush expects Apple Intelligence to drive a major upgrade cycle, starting with the iPhone 16 this year and accelerating with the iPhone 17 in September.
The tech giant has already seen AI spark demand in the U.S., and now the company is hoping for the same in China.
Wedbush argues that Apple’s AI strategy isn’t about competing with ChatGPT or other AI models. Instead, it’s about integrating AI into its devices and making the App Store the go-to platform for AI-powered apps.
The firm sees this as a massive long-term opportunity, predicting that 25% of the global population will eventually use AI through an Apple device.
Alibaba also stands to gain. The company is already a leader in China’s AI and cloud computing race, and its partnership with Apple further cements its dominance. With more government stimulus expected to boost China’s tech sector, Wedbush believes this deal is well-timed.
Despite Apple’s recent struggles in China, Wedbush remains optimistic. The firm points to Apple’s massive global user base—1.5 billion active iPhones and 2.4 billion iOS devices—as proof that the company still has unmatched customer loyalty.
China has been a weak spot, but Wedbush expects growth to rebound next quarter, setting the stage for a stronger 2026.
Wedbush maintains its “outperform” rating on Apple with a $325 price target. The firm believes CEO Tim Cook has once again found a way to navigate China’s regulatory landscape while keeping Apple’s AI ambitions on track.
In early trading, the shares were flat at $241.43, valuing the business at $3.61 trillion.