tim cook, boss of apple, is h**ing a rough start to 2024. in the past month his company has faced an unusual barrage of unpleasantness. a patent dispute forced it to remove features from two of its smartwatches. it found out that america's department of justice (doj) would be suing it over antitrust transgressions. and it reported that it was losing market share in china, its second-biggest smartphone market. adding insult to injury, a few wall street analysts said something unthinkable until recently—that apple's shares were overvalued. on january 11th microsoft, a rival tech titan, duly dethroned the iphone-maker, temporarily, as the world's most valuable company.
Apple boss Tim Cook hasn't had a good start to 2024. Over the past month, his company has faced an unusual series of unpleasantness. A patent dispute forced Apple to remove the functionality of two smartwatches. It found that the U.S. Department of Justice (DOJ) will prosecute it for antitrust violations. The company also reported that it is losing market share in China, its second-largest smartphone market. To add insult to injury, some Wall Street analysts have said something that was unthinkable until recently – Apple's ** is overrated. On January 11, rival Microsoft duly replaced the iPhone maker as the world's most valuable company.
the run of bad news may continue on february 1st, when apple reports its latest quarterly earnings. equity researchers estimate that its revenues barely grew in the last quarter of 2023, if at all. then, on february 2nd, apple will be tested once again. it will start shipping the vision pro, an augmented-reality (ar) headset that it has been working on—and talking up—for a few years. the high-end gadget, which will sell for $3,499, represents a big bet on a new technology "platform" that, apple may be hoping, could one day replace the smartphone as the core of consumers' digital experience—and the iphone as the source of its maker's riches. early indications hint that apple should worry about the device's prospects. netflix, spotify and youtube h**e announced that they will not make their popular streaming apps work on the headset. none said why. but it could be because they all compete with apple's own streaming services, and developing an ar app is likely to be costly.
The bad news is likely to continue on February 1 when Apple reports its latest quarterly earnings. *Researchers estimate that the company's revenue in the last quarter of 2023 will barely grow, if at all. Then, on February 2, Apple will be put to the test again. It will begin selling Vision Pro, an augmented reality (AR) headset that has been in development and advertised for several years. The $3,499 high-end device represents a big bet by Apple on a new technology "platform" that it hopes could one day replace smartphones as the centerpiece of consumers' digital experiences and iPhones as its manufacturers' wealth**. Early indications are that Apple should be concerned about the future of this device. Netflix, Spotify, and YouTube have announced that they won't be letting their popular streaming** app run on this headset. No one told why. But that's probably because they're all competing with Apple's own streaming** service, and the cost of developing AR apps can be high.
mr cook can brush off some of these worries. despite everything, apple's share price has not moved meaningfully in january. a few days after being overtaken by microsoft, it reclaimed its he**yweight stockmarket title—and its $3 trillion valuation. and if the vision pro's launch is a flop, the short-term effect on apple's revenues will be nugatory, given the headset's limited initial production.
Cook can ignore some of these concerns. Despite this, Apple's share price did not show meaningful changes in January. A few days after being overtaken by Microsoft, it regained its heavyweight market title – and a $3 trillion valuation. If the launch of the Vision Pro is a failure, the short-term impact on Apple's revenue will be futile, given the limited initial production of headphones.
nevertheless, apple's boss would be unwise to dismiss the new year's niggles. for they point to larger challenges for the company. these fall into three broad categories: antitrust and legal issues; slowing iphone sales; and growing geopolitical tensions. none of these is existential right now. but each carries with it a risk of causing a big upset. could they cost apple its position as the world's most valuable company for longer than a week or so?
Still, it would be unwise for the Apple boss to shrug off these minor issues in the new year. Because they point to the bigger challenges the company is facing. These issues fall broadly into three broad categories: antitrust and legal issues; iPhone sales slowdown; and rising geopolitical tensions. At the moment, none of this is an existential issue. But with everything comes the risk of causing great unease. Will they cost Apple more than a week or so of being the world's most valuable company?
though apple's market value has been among the world's top ten since 2010, until a few years ago it traded at a low valuation relative to profits. it was thought of as a maker of hardware, a business that is more difficult to scale than software.
Although Apple's market capitalization has been among the top 10 in the world since 2010, until a few years ago, its valuation was low relative to profits. It is considered a hardware manufacturer, which is a more difficult business to scale than a software manufacturer.