Apple Event in San Francisco Fails to Impress Investors

Apple Event in San Francisco Fails to Impress Investors
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The Bill Graham Civic auditorium was jam packed as Apple CEO Tim Cook presented all that is new and shiny from the Apple house. The interest was huge, there was even internet streaming, the expectations were, however, dim. Ever since Steve Jobs passed, Apple was not the innovative company they still would like to be. Despite the flashy event, Apple did not bring anything essentially new to the table, quite to the contrary. If this event would have taken place in 2013, all that was presented would have been okay. But now it not only seems outdated, the presented technology and self-proclaimed innovative inventions are only things we have already seen done years before and done better. Apple is losing the technology race big time, but more than that, Apple is becoming the focal point of ridicule, which is something they managed to avoid for decades.

Since April 28th of 2015, Apple’s stock has fallen 14% and the decline is not going to rebound. The explanations for this go from the stock crash in China, to the average sales of the iPhone, over the lacklustre reception of the Apple Watch, all the way down to ridiculous conspiracy theories and overall tech-sector sales declines, which are completely groundless. Viewed on a world-wide scale, sales of smartphones are increasing, the overall sales of gadgets and handheld devices are still strong, despite a perceivable fall in sales of tablet devices. While Apple is trying to convince people that they have invented the wheel, other manufacturers, like HTC for instance, are looking for new avenues to pursue. HTC is currently working together with Valve in creating the next generation of Virtual Reality, the HTC Vive.

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Reuters did a nice evaluation regarding why Apple’s stock was growing in the past year and it seems that about sixty per cent of Apple revenue growth and eighty per cent of its operating income growth recently were due to China inflating that value artificially, a practice that did lead to the China stock crash earlier this year. If this is the case, namely, that China or in this case the Communist Chinese government, artificially inflated their stock value and consequently inflated Apple stock value as well, then Apple as a company may be significantly less stable and valuable than it is generally assumed. Moreover, such dependence on China may allow the question how far Apple is still an American company, but this would be far-fetched.

In any case, the Apple September event failed to incite investors into a positive response, which will most likely show in the fourth quarter bottom line and probably a further value decline. Apple’s desperation can be observed in the new concept of the iPhone upgrade program, which misuses the carriers as sales representatives of Apple, but somewhat allows Apple to have a secured income and guaranteed sales over years to come. The question here is why the carriers accept this overlord behaviour, but if the sales do not skyrocket, the carriers will very likely dump this idea at the first possible moment.

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