Apple shares on pace for best day since 2022 after earnings beat

An apple shares jumped more than 6% on Friday morning after the company reported better-than-expected second-quarter earnings and its largest share buyback program. If the gains hold until the market close, it will be the best day for Apple stock since November 30, 2022.

The iPhone maker announced Thursday that it will buy back $110 billion of its stock, the largest buyback in U.S. history, surpassing Apple’s previous buybacks. The company reported earnings of $1.53 per share on revenue of $90.75 billion, beating analysts’ estimates of $1.50 per share on revenue of $90.01 billion, according to LSEG.

But overall sales fell 4% and iPhone sales fell 10% year over year in the quarter, indicating weak demand for the latest generation of the smartphone. Apple CEO Tim Cook told CNBC that quarterly sales suffered from a difficult year-ago period.

Analysts at Bank of America reiterated their buy rating on Apple stock — calling it a top pick — and raised their price target to $230 from $225 in a note to investors on Friday, writing that they expect the company to release features for generative artificial intelligence for the iPhone this year.

“Apple Grows iPhone in Mainland China, Estimates Revisions Turn Positive, and GenAI Features Will Drive Strong Upgrade Cycle,” they wrote.

JPMorgan analysts, maintaining an overweight position, raised their price target on Apple to $225 from $210 on Thursday, citing “sustainable” annual iPhone revenue and “expectations of an iPad upgrade cycle-driven tailwind” ahead of Apple’s product launch event next week.

“Overall, while the modest year-over-year revenue growth may not be the ideal outcome,” they wrote, “it now provides visibility for higher revenue opportunities in the coming years with tailwinds from hardware device product cycles, as well as the AI-led smartphone cycle further driving growth.”

Morgan Stanley analysts maintained their overweight rating on Apple and raised their price target to $216 from $210 on Friday, citing the company’s quarterly performance, annual growth in iPhone shipments to China in March, share buybacks and hints of upcoming updates of AI.

“It’s hard not to get more bullish here,” they wrote.

CNBC’s Michael Bloom contributed to this report.