Wedbush analyst Dan Ives believes next week's Worldwide Developers Conference (WWDC) will be a "pivotal moment" for Apple, Inc. ( AAPL ) as he sees it ushering in the company’s next growth cycle, driven by artificial intelligence (AI). 

Apple To Introduce AI: Apple’s WWDC 2024 is set to kick off on June 10. Ives expects a formal announcement from Apple ( AAPL ) regarding a partnership with OpenAI, including a chatbot with exclusive features building upon on-device Apple ( AAPL ) large language models (LLMs) and cloud-powered Apple LLMs.

In a new note released Tuesday, Ives predicted that Apple ( AAPL ) would lay the groundwork for an AI App Store on its new AI software stack, which will lead to additional growth in the company's Services segment in the coming years. Ives highlighted Apple's ( AAPL ) "rock solid" Services segment and its double-digit growth as key drivers of the company's valuation. 

The Wedbush analyst also expects the iPhone 16 to include new AI features, sparking an "overdue" upgrade cycle into 2025. He projected that the pent-up consumer demand around the next upgrade cycle could possibly exceed 270 million iPhones heading into the iPhone 16. 

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Why It Matters: Ives pointed to Apple's ( AAPL ) "golden" customer base of 2.2 billion iOS devices globally as an ideal ecosystem to capitalize on the "ample monetization opportunities" that will come with the introduction of AI.

"WWDC is a pivotal moment in Apple’s future as the developers are the hearts and lungs of the Cupertino growth story and will now start a new AI driven chapter in the Apple ( AAPL ) growth story for the coming years," Ives wrote in the note. 

"The Street will be laser focused on Apple ( AAPL ) Monday at WWDC in Cupertino with its biggest event in over a decade."

Wedbush maintained its Outperform rating on Apple ( AAPL ) on Tuesday and kept a price target of $275 on the stock.

AAPL Price Action: According to Benzinga Pro, Apple ( AAPL ) shares closed Tuesday up 0.16% at $194.35.

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