Apple Gains From Engaging Apple TV+ Content: What's the Path Ahead?

Apple AAPL is riding on its Services segment, which benefits from strong demand for Apple TV+ content. The streaming service continues to expand its slate of high-quality original content, including award-winning series like Severance, The Studio, and Slow Horses. Apple’s ongoing productions have earned widespread recognition, with Emmy nominations across 14 titles this year.

Flagship titles like Severance scored 27 nominations at this year’s Emmy Awards and drove a 126% surge in sign-ups during the second season. The show recorded 6.4 billion streaming minutes, while other titles like The Studio and The Gorge earned numerous critical appreciations. The Gorge secured Apple’s first-ever nominations for Outstanding Television Movie. Apple TV+ achieved a record-breaking 81 Emmy nominations this year, spanning 14 original titles.

The company’s original film F1: The Movie grossed nearly $400 million worldwide and is expected to generate additional revenues through streaming and video-on-demand releases. This push is further supported by its growing sports portfolio, which engages fans through Friday Night Baseball, MLS Season Pass and Formula 1 updates via the Apple Sports app.

Our model estimates for AAPL’s third-quarter fiscal 2025 Services revenues are pegged at $27.3 billion, indicating a year-over-year growth of 12.9%.

Apple Faces Tough Competition in Streaming Market

The rising appetite for premium original content, especially in genres like sci-fi, sports and thriller, is intensifying the competition among global platforms. This bodes well for Disney’s DIS Disney+ and Comcast CMCSA owned Peacock’s growing and diverse content slates.

Disney expects a major push in Disney+ engagement with its strong content pipeline, including upcoming titles like Alien: Earth, Percy Jackson and the Olympians, King of the Hill, and the new weekday show What You Need to Know. 

Comcast’s Peacock has strategically invested in its expanding content and partnerships. Backed by NBCUniversal, it has secured key broadcasting rights, including the NFL, Premier League, Big Ten and, recently, the NBA — along with a $3 billion deal with the International Olympic Committee for streaming rights to the Olympics through 2036.

AAPL’s Share Price Performance, Valuation and Estimates

Apple shares have dipped 14.8% year to date, underperforming the broader Zacks Computer and Technology sector’s return of 10.7%.

AAPL Stock's Performance

Apple stock is trading at a premium, with a forward 12-month Price/Earnings of 28.1X compared with the industry’s 27.51X. AAPL has a Value Score of D.

AAPL Valuation

The Zacks Consensus Estimate for fiscal 2025 earnings is pegged at $7.10 per share, unchanged over the past 30 days, suggesting 5.19% year-over-year growth.

Apple Inc. Price and Consensus

Apple Inc. price-consensus-chart | Apple Inc. Quote

Apple currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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