Research archive for AAPL

Apple's future profit growth will likely come from their services business, where they charge app developers a percentage of any in-app purchase. Their argument is that they provide a safe platform, and a massive user base. However, Apple has lost a few court cases about their app store payment arrangements being anti-competitive, and it may well be forced to open things up.

Apple released results last week, which were broadly in line with analyst expectations. Apple's size and momentum make its results fairly predictable. Revenue for the previous quarter was $95 billion, up 5%, resulting in profits of $25 billion.

After spooking markets with a wave of heavy-handed tariffs, Trump has backpedaled and further excluded a bunch of tech gear like smartphones, laptops, semis, and solar panels from the eye-watering 145% tariff hike on Chinese imports. The move is being spun as a strategic push to give companies time to shift manufacturing to the US, but let's be honest, it probably has more to do with the $640 billion Apple selloff and tech stocks bleeding out.

Apple has refreshed its iPad lineup, introducing a new iPad Air with the M3 chip, a redesigned keyboard, and an upgraded entry-level tablet. The latest iPad Air, available in 11-inch and 13-inch sizes ($599 and $799), now runs twice as fast as the M1 version. AI tasks also perform 60% faster than the 2022 model.

Last week, Alibaba announced that it is partnering with Apple to roll out the latter's AI offering in China. Given how politically sensitive data processing and AI capabilities are at the moment, it makes sense that Apple has chosen to partner with a local company. It is interesting that they aren't partnering with DeepSeek.

As previously noted in this newsletter, Apple and Starlink are teaming up. This is a very exciting development.

Apple's latest quarterly numbers were solid. Total revenue grew 4% to $124.3 billion, beating estimates, notwithstanding iPhone sales being 1% softer at $69.1 billion.

Having a large user base has many advantages. Consider Apple, who have over 1 billion loyal clients. A service called Apple News already has over 125 million monthly users in the US, Canada, UK and Australia.

Apple is set to elevate its Apple Watch Ultra with satellite connectivity in 2025, allowing off-grid messaging without a phone. The feature, leveraging its partnership with Globalstar, builds on Apple's satellite innovations first introduced with the iPhone 14. Shares of Globalstar jumped 15% on the news.

Apple TV+ and Amazon Prime Video are two under-performers in the streaming wars. Their respective market shares are disappointing given that they both have good brand recognition and each company has spent billions to create the service. It is a reminder of how well Netflix has done.

Apple is gearing up to launch a new iPhone SE and upgraded iPads early next year. The iPhone SE, codenamed V59, will ditch the home button for an edge-to-edge screen design, resembling the iPhone 14.

The US FDA has approved Apple's new sleep apnea detection feature, on the Apple Watch Series 9, Series 10 and Ultra 2.

Apple has introduced "Apple Intelligence," a personal AI system for iPhone, iPad, and Mac. To handle more complex tasks, they've developed Private Cloud Compute (PCC), a cloud-based system designed for private AI data processing. What sets PCC apart is its focus on privacy - user data remains encrypted and out of reach, even from Apple.

The chart below shows the 12 most valuable companies in the world, ranked by their market capitalisation. Which ones do you own in your portfolio? If you are a Vestact client, you most probably own 8 of them, or perhaps 9. If you've been a client for many years, you've owned them since before they were on this list.

Apple reported earnings on Thursday that surpassed Wall Street forecasts with a 5% revenue increase. Despite the strong performance, Apple shares remained flat in after-hours trading and only closed 0.7% higher on Friday.