Apple Downgraded to ‘Sell’ by Jefferies Over Cancelled All-Glass iPhone and Rising Costs

Apple has been downgraded to underperform from hold by investment firm Jefferies, with analysts lowering the stock price target to $263.66 from $285.56 on August 10, 2026. According to Jefferies supply-chain checks reported by Sebastian Herrera at Fortune and detailed by CNBC, the downgrade stems from the cancellation of a rumored all-glass iPhone, soaring memory costs driven by artificial intelligence adoption, and a lack of new device shapes to command premium pricing.

The Collapse of the All-Glass Form Factor

Apple may no longer debut its anticipated all-glass iPhone next year due to manufacturing roadblocks. Edison Lee, analyst at Jefferies, stated in a note to clients that “the all-glass iPhone (Sep 27) has been canceled due to low yield.” This intended hardware evolution was supposed to hit the market in September 2027. The engineering goal was to scale these all-glass aesthetics to future iPhone Pro and Pro Max models, directly lifting the average selling price and hardware margins. Instead, low manufacturing yield rates forced a hard stop on the blueprint.

Apple appears to have temporarily run out of viable iPhone shapes to stimulate upgrade cycles. Introducing entirely new form factors to drive higher average selling prices has proven significantly more difficult than expected.

Surging Memory Costs and the Foldable Gamble

Hardware margins face a secondary squeeze from the global semiconductor market. Memory prices are surging, catalyzed heavily by widening artificial intelligence adoption across enterprise and consumer hardware segments.

The rollout of Apple’s first foldable iPhone is slated to debut in September 2026. Lee highlighted this foldable device as the “only key driver of higher ASP and margin” in the near-term. Yet, soaring memory costs could push the starting retail price of this foldable unit north of $2,000. Such an aggressive price point risks turning the foldable iPhone into a niche product, ultimately restricting mass-market volume and capping upside for the stock.

Wall Street Sentiment Versus Supply Chain Reality

The Jefferies downgrade runs counter to broader consensus on Wall Street. LSEG data shows that out of 47 analysts covering Apple, 30 maintain a buy or strong buy rating on the equity. Only three shops across the street carry an underperform rating. Jefferies lowered its forecast for Apple’s earnings per share by 2.1% for fiscal year 2028, reflecting deep skepticism over near-term hardware catalysts.

Shares of Apple edged down more than 1% in pre-market trading following the Monday downgrade, though the equity remains up roughly 15% year-to-date.