Main topic: Apple's financials in Q3 2023
Key points:
1. Apple's revenue from its Services segment reached an all-time high of $21.2 billion, growing 8% year-over-year.
2. iPhone, Mac, and iPad revenue declined compared to a year ago, with iPad sales experiencing the largest drop.
3. Overall, revenues dropped less than 2% year-over-year, while profits increased about 2% to $19.9 billion.
Apple's iPhone sales in China have surpassed those in the United States for the first time, contributing to Apple potentially becoming the biggest player in the smartphone market this year, despite global smartphone shipments being on track to be the worst in a decade due to economic headwinds in China and the US, according to Counterpoint Research.
Four Big Tech companies - Apple, Microsoft, Tesla, and Meta - collectively lost $625 billion in market value this month, likely due to seasonal trends and a broader decline in US equities triggered by higher bond yields.
This article mentions the stock of Apple (NASDAQ:AAPL). The author's suggestion is not explicitly stated, but they express concerns about the low dividend yield, modest dividend growth, and potential overvaluation of Apple's stock. The author also discusses Apple's strong brand, the possibility of an acquisition of Disney's assets, and the headwinds and risks facing the company. The author suggests that a recession or market correction could lead to a potential price drop and provide a good entry point for investors. However, they also acknowledge the potential for the stock to continue trending upwards, especially during the holiday season.
Four major tech companies, including Apple, Alphabet, Microsoft, and Meta, have collectively spent over $1 trillion on stock buybacks in the past decade, exceeding the market values of Tesla, Meta, and Berkshire Hathaway.
Apple's stock market value surpassed $3 trillion for the first time, driven by signs of improving inflation and expectations of successful expansion into new markets, with technology stocks rebounding on bets that the US Federal Reserve may slow its rate hikes.
Apple shares have declined due to falling revenue in its product segments, but the company's long-term outlook remains strong, driven by its booming services business and dominant market shares, with two reasons to buy Apple stock being the upcoming iPhone launch and its potential in high-growth industries like AI and virtual/augmented reality.
The stock market sinks as a tech selloff occurs due to investors' fear of more Fed rate hikes, with Apple, Tesla, and Nvidia all experiencing significant declines.
Apple Inc. experienced a significant decline in its stock price after reports emerged that Chinese government agencies have banned the use of iPhones and other foreign-branded devices by their staff.
Apple stocks fell 3.6% after China reportedly banned officials from using or bringing iPhones and other foreign-branded devices into the office, signaling Beijing's push to reduce dependence on American technologies.
Stocks sold off and major indexes closed in the red, while U.S. Treasury yields rose for the second consecutive day; China's trade activity fell in August, but not as badly as expected; Apple signed an agreement with Arm that extends beyond 2040, securing access to the Arm architecture; China reportedly banned government officials from using Apple's iPhone for work; and inflationary pressures and the threat of higher interest rates are causing market concerns.
Apple shares fell during out of hours trading on Thursday, following reports that China has banned government employees from using iPhones, posing a potential threat to Apple's sales and global supply chain.
Big tech, including Apple, faced pressure as concerns grew over China potentially expanding its iPhone ban, while equity futures fell due to strong jobless claims figures, reinforcing the case for the Federal Reserve to maintain elevated interest rates.
Apple shares fell over 2.6% as China plans to extend a ban on iPhone use to state-owned corporations, while Dutch Bros dropped 6% after announcing a public offering of $300 million in shares, and Dave & Buster's shares fell over 3% due to weaker-than-expected earnings.
The Dow Jones Industrial Average dropped after a decrease in initial unemployment claims, while Apple stock declined due to China's order for officials to not use iPhones and other foreign-branded devices for work.
The Nasdaq tumbled due to Apple's falling shares after reports of China banning government officials from using its iPhone and extending the ban to state companies, while the Dow Jones Industrial Average remained flat and the S&P 500 dropped 0.4%.
Apple's recent sell-off due to concerns about a Chinese crackdown on iPhone usage among government workers should not deter investors from the tech giant.
Despite reports of China banning iPhone use for government employees, CNBC's Jim Cramer advises investors not to sell Apple, citing the company's ability to adapt and potentially find a compromise with China.
Apple shares face a downturn as China plans to extend its ban on iPhones to government agencies and state companies, potentially wiping out $200 billion of the company's market value, as China's economic crisis threatens demand for consumer electronics and rising US Treasury yields add to Apple's troubles.
Asian shares fell and the dollar's rally stalled as the greenback weakened against most major currencies; concerns over Apple's iPhone sales in China and the expansion of a ban on iPhones in sensitive departments in China to government-backed agencies and state companies also weighed on sentiment.
Shares of major Apple suppliers dropped following reports of China widening curbs on iPhone use by state employees, raising concerns about sales in one of Apple's biggest markets.
The US economy is displaying resilience with jobless claims at their lowest since February and increased consumer spending on travel and experiences, despite challenges such as the resumption of student loan payments and oil production cuts by Saudi Arabia and Russia. Apple's stock has also been affected by the Chinese government's expanding iPhone ban, reflecting the broader tensions between the US and China.
Bitcoin could decline by more than 60% if Apple's market cap continues to decline, according to crypto analyst Nicholas Merten. A plummeting Apple market cap would have a significant impact on Bitcoin and other equities.
Rumors of an iPhone ban for government employees in China caused major market benchmarks, including Apple (AAPL), to experience a down week and sparked concerns over tensions between the US and China.
Apple's bet on China has come back to haunt CEO Tim Cook as Beijing's recent ban on state employees using foreign-branded smartphones, including the iPhone, could cost the company $19 billion in revenue and has prompted questions about the worth of Apple's appeasement of the Chinese Communist Party.
U.S. stocks fell on Tuesday, with tech stocks dragging down indexes after Apple unveiled its latest iPhone and the Justice Department's antitrust case against Google went to trial in Washington. The Nasdaq sank 1%, while the S&P 500 fell 0.6% and the Dow Jones Industrial Average closed 0.1% lower.
Dow Jones futures, along with S&P 500 futures and Nasdaq futures, were unchanged after hours as the stock market rally experienced losses, with the S&P 500 and Nasdaq dropping below the 50-day line, while energy stocks led and software retreated. Apple stock fell after unveiling the iPhone 15 and other products, while stocks such as Salesforce, Alphabet, General Electric, Shopify, and Nvidia remained in or near buy areas. The CPI inflation report and Adobe earnings are potential market catalysts.
Apple's stock dropped 7.2% in the week leading up to the iPhone 15 launch, the largest decline ever for an iPhone release, signaling investors' lack of enthusiasm for the company's stagnant growth compared to other S&P 500 companies.
Apple is facing growing troubles in China, with tensions rising between the US and China, the ban on government employees using iPhones, and China's economic woes, prompting the tech giant to shift its focus to India as a potential market for growth.
If you had bought a top-of-the-line iPhone every time Apple released a new model instead of buying Apple stock, you would have spent around $16,000 on iPhones and made a profit of approximately $131,000 if you had bought the stock instead.
The article does not mention any specific stock recommendations. However, it discusses Apple (NASDAQ:AAPL) extensively and highlights the author's positive view towards the company's valuation and growth prospects.
The author's core argument is that while Apple's growth has slowed, its elevated valuation is justified due to factors such as its superior competitive position, strong brand and connection with consumers, solid prospects for future growth, and strong financial position.
Key information and data mentioned in the article include:
- The Wall Street Journal reported that the Chinese government had banned iPhones for government employees, but the Chinese government later denied this report.
- If the ban had been true, analyst Dan Ives estimated it would be a hit of half a million iPhones, but he referred to it as "more bark than bite."
- Apple's growth has slowed, but its high valuation is justified due to its many advantages, including its competitive position and strong financials.
- Apple's valuation is less dependent on current earnings and more focused on long-term prospects.
- Apple's revenue is comparable to other massive companies, but it still has room for growth, especially in the high-margin services segment.
- Apple's dependence on China is both a risk and an advantage, as China is also dependent on Apple.
- The Chinese economy is facing challenges, and a cooperative relationship between the US and China would benefit Apple and the global economy.
- The author believes that Apple's strong management and adherence to secrecy and compartmentalization give it a unique edge.
- The author suggests that expectations for Apple may be too low if globalization is not receding as expected.
Microsoft's shares have outperformed Apple's as investors see better growth prospects and less China risk, making some analysts believe that Microsoft may overtake Apple as the world's highest-valued company.
This article mentions the stock of Apple (NASDAQ:AAPL). The author's recommendation is to buy Apple's stock.
The author's core argument is that Apple's historical growth and expanding margins make it an attractive investment. They also discuss the pricing strategies and innovations of Apple's new iPhone lineup, suggesting that it will drive sales growth. The author also addresses the potential challenges of prolonged upgrade cycles and the risks associated with the Chinese government's actions towards Apple. They provide valuation metrics and projections for Apple's future revenue and stock price.
Goldman Sachs strategists have noted that the largest tech stocks, including Apple, Microsoft, and Amazon, are now trading at their cheapest valuation relative to the median stock in over six years, as their price-to-earnings ratio has fallen to 27 from 34.
Apple stock is expected to face challenges due to lower iPhone upgrade rates and a lack of immediate catalysts, according to analyst Brandon Nispel, who downgraded the stock to neutral and noted that Apple's valuation is stretched compared to historical rates.
