Key Points

• Apple shares have been a monster winner in the past, as its products and services gained widespread global adoption.

• Investors should be concerned about the growth trajectory of the iPhone, which is being negatively impacted by Apple’s slow AI rollout.

• A lower starting valuation would certainly add upside to this top tech stock.

• 10 stocks we like better than Apple ›

Apple's (NASDAQ: AAPL) stock price has shot up 14,760% in the past 20 years thanks to the budding popularity of its hardware devices and software solutions that have won over consumers across the globe. Even in the past five years, investors have been rewarded with a 150% gain (as of June 4).

Apple is a behemoth today, with a market cap of $3 trillion. But the stock trades 22% off its peak, which might present a potential buying opportunity. Where will shares in this dominant consumer electronics enterprise be in five years?

Is it the beginning of the end for the iPhone?

The iPhone might be the most successful product of all time. It was released for the first time in 2007, and now it's on its 16th upgrade cycle. In the fiscal 2025 second quarter (ended March 29), this single product generated $47 billion in revenue for Apple, accounting for 49% of the total. The issue, though, is that this sales figure was up only 2% year over year.

From a consumer's perspective, it makes sense to wait longer between upgrades simply because the newer features aren't as revolutionary as they were before. It's probably not worth spending a four-figure sum for minor tweaks to the camera, for instance.

Maybe by 2030, a new device will be created that changes how people interact with technology and get things done. It was announced recently that OpenAI will acquire the design firm io from Jony Ive, former Chief Design Officer at Apple, for $6.5 billion. The goal is to create a totally new product that is built specifically for artificial intelligence (AI).

For what it's worth, I'm not ready to claim that the iPhone is dead. After all, it raked in more revenue in a three-month span than most companies do in an entire year. But the slowdown highlights potential challenges for the company as we look ahead. One is that perhaps Apple Intelligence is behind the curve, as evidenced by its inability to drive more iPhone 16 purchases.

The critics have called out Apple's failure to create the next game-changing hardware device that can push the financial needle. Apple was reportedly working on an electric car for a decade. In the U.S. alone, 17.7 million passenger vehicles were sold on a seasonally adjusted annual basis in April, so this market is certainly big enough for this business to focus on. However, Apple shut down this project last year.