Apple reached a market capitalization of $4 trillion for the first time on Tuesday, becoming the third tech giant to achieve this milestone. Strong demand for its latest iPhones has mitigated fears regarding the company’s slow progress in the AI sector. On the same day, the U.S. stock market soared to an all-time high, with Microsoft also achieving a $4 trillion market cap for the second time.
Since the announcement of its new product on September 9, Apple’s stock price has increased approximately 13%, marking a significant rebound that has pushed the stock into positive territory for the first time this year.
“The iPhone constitutes over half of Apple’s profits and revenue, and the more devices we can distribute, the more users we can integrate into our ecosystem,” noted Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management, prior to the milestone.
Earlier this year, Apple’s shares faced challenges from intense competition in China and uncertainty surrounding the impact of high U.S. tariffs on Asian markets, where the company relies heavily on manufacturing.
The newly launched iPhone 17 has attracted customers from Beijing to Moscow within weeks of its release, with Apple absorbing high tariffs rather than transferring costs to consumers. Analysts believe the sleek design of the iPhone Air could help it compete against rivals like Samsung Electronics Co., with early sales of the iPhone 17 exceeding its predecessor in both the U.S. and China by 14%, according to research firm Counterpoint. Some analysts suggest that the demand forecast for the iPhone Air may not be met, while other companies have disputed these claims.
Following Nvidia and Microsoft, Apple becomes the third company to breach the $4 trillion mark, with Nvidia currently leading the group at over $4.5 trillion.
Microsoft achieved its initial stock market milestone in July. Following a minor dip in stock prices, the company re-entered the exclusive club as shares climbed after the ChatGPT creator announced a partnership with OpenAI on Tuesday, allowing it to transition into a public benefit corporation. OpenAI boasts a valuation of $500 billion, making Microsoft’s 27% stake in the company worth over $100 billion.
After newsletter promotion
Unlike Microsoft’s aggressive AI strategy, Apple’s cautious stance has raised concerns about its position in what could become the industry’s most significant growth opportunity in years. Recent reports have also highlighted the departure of several senior AI executives to Meta.
Rollout delays for Apple’s Intelligence suite, which includes ChatGPT integration, and a postponed AI upgrade for its voice assistant Siri until next year have disappointed some consumers, as these products currently lack features found in competing AI software.
Apple recently reported its best quarterly results in years for the April-June period, achieving double-digit growth in key segments and exceeding analysts’ expectations. The company is set to announce its fourth-quarter results on October 30th.
Source: www.theguardian.com
