Apple becomes 3rd company to hit a $4T market cap
What's the story
Apple has become the third company in history to reach a market cap of over $4 trillion. The milestone was achieved today, driven by strong demand for its latest iPhone models. The company's shares have seen a remarkable recovery since the new launches on September 9, gaining nearly 13% and pushing the stock into positive territory for the first time this year.
Revenue impact
iPhone sales crucial for Apple's success
The iPhone contributes to over half of Apple's profit and revenue. Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management, said that the more phones Apple can sell, the more they can draw people into their ecosystem. Earlier this year, Apple's shares were weighed down by fears of stiff competition in China and uncertainty over how it would deal with high US tariffs on Asian economies like China and India, where it manufactures most of its products.
Market response
iPhone 17 series and Air attract global customers
The new iPhone 17 series and iPhone Air have attracted customers from Beijing to Moscow within weeks of their launch. Despite the high costs from tariffs, Apple has managed to retain its customer base. Analysts believe that the sleek design of the iPhone Air could help it compete against rivals such as Samsung. Data from research firm Counterpoint shows early sales of the iPhone 17 outperformed its predecessor by 14% in both the US and China.
AI strategy
Concerns over AI integration and slow growth
Apple's cautious approach to artificial intelligence (AI) has raised concerns about missing out on a major growth driver. The company has been slow in rolling out its Apple Intelligence suite, including a ChatGPT integration, with an AI upgrade for Siri delayed until next year. Despite these concerns, Evercore ISI expects strong demand for Apple's latest iPhones will help it beat market expectations for the September quarter, and provide optimistic guidance for December quarter results.
Market anticipation
Apple set to report 4th-quarter results on October 30
Apple will report its fourth-quarter results on October 30. The company posted its best quarterly results in years for the April-June period, with double-digit growth across all major categories. However, Apple shares have gained over 7% this year, lagging behind tech-heavy NASDAQ's nearly 22% gain.