Morgan Stanley has pared its Apple price target from $364 to $360 after slowing Services growth and higher memory costs weakened its earnings outlook, despite strong demand for the company's products. Services growth is falling below 10%Apple's Services business generated $30.7 billion during the quarter, up 12% from 2025. Foreign exchange accounts for much of the slowdown, but Morgan Stanley also pointed to weaker App Store performance. Morgan Stanley said it hasn't yet seen a clear measurable boost from AI in either product demand or Services revenue. Morgan Stanley's estimated underlying gross margin of 46.5% would be about 1.5 percentage points lower than Apple's June-quarter gross margin.