11:52 AM EDT, 10/25/2024 (MT Newswires) -- Apple's ( AAPL ) iPhone 16 demand is expected to increase after the release of Apple Intelligence in late October, BofA Securities said in a report Friday.

The tech giant is also expected to report a slight revenue beat for the September quarter, or fiscal Q4, and a more favorable outlook for the December quarter after the market closes on Thursday, BofA said.

The "staggered" launch of Apple Intelligence and the integration of Microsoft ( MSFT )-backed (MSFT) OpenAI's ChatGPT into iOS 18.2 are expected to drive iPhone demand, BofA said.

The consensus revenue estimates for services and overall gross margins for the December quarter are "too low," and any potential weakness in iPhone sales should be offset by stronger margins, resulting in minimal negative earnings per share revisions, according to the note.

The brokerage projects 52 million iPhones for September and 80 million for December, with slightly higher average selling prices due to strong Pro demand.

BofA revised its estimates on Apple's ( AAPL ) revenue and earnings per share for fiscal year 2025 to $428 billion and $7.62, respectively, from $435 billion and $7.66.

BofA has reiterated its buy rating and a price target of $256 on Apple's ( AAPL ) stock.

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