Apple Inc (NASDAQ:AAPL) may still be iconic, but its stock is no longer invincible. Since peaking against the Magnificent 7 in late 2022, Apple's relative performance has plunged over 45%, a jaw-dropping fall that underlines how far the tech giant has lagged behind its Big Tech peers.

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A price ratio chart comparing Apple to the aggregate Mag 7 soared to 0.17 in November 2022. Fast forward to June 2025, and that figure has collapsed to 0.09. While the broader Mag 7 group has powered ahead on AI momentum, Apple has been on a different trajectory -- down 17% year-to-date and struggling to reclaim its former leadership.

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Tariffs, Tech Turmoil & iPhone Woes

The biggest culprit? Geopolitics.

Apple's reliance on Chinese manufacturing has put it squarely in the crosshairs of Trump-era tariffs. A recent 25% tariff threat on non-U.S.-made iPhones shaved billions off Apple's market cap overnight, exposing the company’s supply chain vulnerabilities. While production shifts to India may soften the blow, they come with time and cost.

Add to that broader market weakness -- interest rate uncertainty, stretched valuations and flagging iPhone enthusiasm --and you've got a recipe for underperformance.

AAPL stock has been the worst-performing Mag 7 stock in 2025, shedding momentum as investors rotate toward names more plugged into the AI boom.

Is Services Growth Enough To Offset Hardware Drag?

There's still one bright spot: services. Apple's services division posted $26.3 billion in first quarter revenue with 75% margins, offering a strong buffer against hardware volatility. Analysts project this segment could reach $180 billion by 2030, helping to shift Apple's growth narrative from devices to recurring revenue.

Still, the question remains whether services growth is enough to counter declining iPhone excitement and regulatory pressures. With competitors such as Samsung, Huawei and Alphabet Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) accelerating innovation, Apple's path forward will require more than just ecosystem loyalty -- it'll need breakthroughs that reignite investor confidence.

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