In the second half of 2023, Apple’s market capitalization crossed the 3 trillion barrier twice – the first in early July and the second in mid-December. dollars. Today, however, the picture appears to be different, as the upward momentum has been replaced by a downward trend, which has seen the group’s market value fall by 13% over the past 2.5 months to just over the 2.6 trillion
For those who follow developments in the field of business, however, the recent course of the group founded by Steve Jobs and since 2011 led by Tim Cook is not surprising. This is because there are three (at least) developments that lead to the conclusion that he does not have a good… moon – or, to be more precise, that he is at a difficult juncture, from which significant changes in strategy and the structure itself are likely to emerge. of Apple.
Fine-mammoth
The most recent of these developments concerns the mammoth 1.8 billion fine imposed on it by the EU for breaching existing antitrust laws. Despite the fact that the above sum represents only a small percentage, of the order of 2%, of its last year’s revenue from services, the negative reaction of the stock, which fell by 2.5% last Monday, showed that in the ranks of investors rather uncertainty about the next day prevails.
Moreover, as Lex’s column in the “Financial Times” noted, in other cases of large fines being imposed on large groups – such as against Facebook in the US and Alibaba in China – the reaction of their stock was upward, as it seemed to disappear the “shadow” that was chasing them.
This is also the reason why this analysis considers the EU fine “just the beginning”, as other cases with the European authorities are pending.
Losing ground
But this is not Cook’s only headache. To be fair, it was preceded, late last week, by Bloomberg’s revelation that Apple has decided to end its bid to compete with Elon Musk’s Tesla by building its own semi-autonomous electric vehicles of the future.
It is noted that although its head or other top executives had never officially admitted the existence of the “Titan Program”, it is estimated that the group had allocated several billion dollars to it – only to discover, finally, that its plans and ambitions they wouldn’t be able to flesh him out and turn him into a star on that front.
As if all this was not enough, the data on the sales of iPhone devices in the Chinese market in the first half of 2024 also came to give another “slap” to Apple. Their decrease by 24% compared to the corresponding period of 2023 proves that the American giant is losing ground in the largest market on the planet, from which it derives almost 20% of its total revenue. This happened, in fact, under the pressure of intense competition – it is no coincidence that homegrown Huawei saw sales in the same period jump by 64%.
Critical decisions
Against this backdrop, the decisions Cook and Apple’s leadership team are called upon to make are critical. Experts point out that the worst can only be prevented with a “leap into the future”, that is, with brave investments in new technologies (such as artificial intelligence) and products – which, of course, will not have the fate of the car under design…
#Apples #difficult #turning #point #structural
