Apple (AAPL) Downgraded as Soaring Memory Costs Test iPhone Pricing Power

Jefferies has downgraded Apple (AAPL) from Hold to Underperform and cut its price target to $263.66, citing rising memory costs and the cancellation of an "all-glass iPhone" that would have helped increase average selling prices. This downgrade comes despite Apple's strong fiscal third-quarter earnings, which showed a 16% year-over-year revenue increase and higher-than-estimated EPS, largely driven by a 22% increase in iPhone sales. While the downgrade highlights potential margin pressure due to soaring memory costs and limited pricing levers, robust demand and stable hedge fund positioning suggest that investor confidence in Apple remains strong.