The Open Question Under Apple Stock’s Price
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Apple (AAPL) stock trades at 38.5 times its earnings, compared with 22.8 for the S&P 500. This price appears to assume the company keeps growing. Apple began rolling out its Siri AI assistant in September, offering its newest reason for people to buy a new iPhone. Siri AI is too new to show whether people will upgrade for it, or what it will cost Apple to run.
How Siri AI Could Earn And Cost Apple Money
Apple makes money from Siri AI when people buy new devices to get it, and the company spends money when requests to Siri AI are answered on its own servers. Management has also pointed to openings in third-party apps, partnerships and wider access to Siri AI features that run on its servers. Apple launched Siri AI in beta for U.S. English users in September, adding French, Japanese, Korean, Portuguese and Spanish in October. Management has said AI offers customers a compelling reason to upgrade and switch to get the latest capabilities.
On costs, management has said a request handled on the device has no real cost, while when a request reaches Apple’s servers, the company pays the computing costs and records them as a cost of its services business. During its fiscal fourth-quarter 2026 call on November 2, analysts asked what role Siri AI will play as AI agents spread, and whether a fast rise in use would change what Apple needs to spend on computing.
The iPhone Brings In Over Half Of Apple’s Revenue
iPhone revenue reached $254 billion in fiscal 2026, representing 53.1% of Apple’s total. That was 21.2% more than in fiscal 2025. In the September quarter, iPhone revenue stood at $57.6 billion, up 17% from a year earlier, and Apple set a September-quarter record for upgraders worldwide. Siri AI arrived in September at the very end of that fiscal year, so most of the year’s iPhone growth came before it was available.
What Apple Has Said About Siri AI So Far
Management has said it is still very early to know how Siri AI’s requests will split between devices and servers, making the cost hard to predict. Apple’s gross margin forecast for the December quarter includes some costs from the Siri AI ramp, though management expects most of the decline from the September quarter, once that quarter’s tariff refund benefit is set aside, to come from higher memory costs. The forecast is 45% to 46%, compared with 47.9% in the September quarter, which included a benefit of about 1 point from tariff refunds. Management has not yet put a figure on what Siri AI adds to sales or what it costs. On AI agents, Apple’s chief executive called them promising tools for users, but said Apple wants users to know what they are giving access to.
Apple also raised iPhone prices in September, the same month Siri AI arrived, so the next iPhone figures will include both changes. Apple expects total revenue to grow 7% to 10% in the December quarter, after 11.7% growth in the September quarter. Management has said that range reflects constrained supply. iPhone revenue for the December quarter, compared with the same quarter a year earlier, is the figure to watch when Apple next reports, expected in January 2027. On cost, the December-quarter gross margin is the place to look, since management said it includes some Siri AI costs.
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