What does Tim Cook do to turn Apple into the greatest “money printing” machine in history?

Tram Ho

In the fourth session (in US time), there was a time when Apple shares reached $ 467.77 / share, helping Apple to reach $ 2,000 billion for the first time. At the end of the session, Apple was unable to maintain this achievement when the stock tended to decrease slightly to $ 462.83 / share – equivalent to $ 1.98 trillion.

Although it did not last long, this was an important milestone for the iPhone maker, thereby helping Apple strengthen the title of the most expensive public company in the world.

Tim Cook làm gì để biến Apple trở thành cỗ máy “in tiền” vĩ đại nhất lịch sử? - Ảnh 1.

Apple was the first US company to hit the $ 2,000 billion mark on the stock market

Statistics show that Apple takes 42 years to reach 1,000 billion, but it only takes 2 years to rise from 1,000 billion USD to 2,000 billion USD. More worth mentioning, Apple reached the milestone of $ 2 trillion in the context of an unprecedented global economic decline due to the impact of the COVID-19 pandemic.

Why, while the world economy was miserable because of epidemics, Apple “soar” with almost impossible numbers. The New York Times has several explanations for the cause

Sublimation because of the epidemic?

The outbreak of the disease made shares of Big Tech become a new “destination” for investors. “Technology stocks are the new flight to safety,” said Aswath Damodaran, professor of finance at New York University.

Companies that are rich, flexible, and digitally active are the ones benefiting from the pandemic. Mr. Damodaran likened the Big Tech group to the new Goliaths.

In mid-March this year, Apple still lost the $ 1,000 billion mark when the market plunged due to concerns about the outbreak of COVID-19 around the world.

On March 23, the US Federal Reserve announced positive measures to reassure investors. Since then, shares of the Big Tech group, including Apple, have gone up almost vertically.

The value of the five tech giants Apple, Microsoft, Amazon, Alphabet and Facebook has grown by nearly $ 3 trillion since March 23, nearly equaling the growth of the 50 most valuable companies on the S&P 500 list combined. including names like Berkshire Hathaway, Walmart and Disney.

It is estimated that Apple’s value increases by about $ 6.8 billion a day, higher than the total value of American Airlines.

Tim Cook làm gì để biến Apple trở thành cỗ máy “in tiền” vĩ đại nhất lịch sử? - Ảnh 2.

Apple’s estimated value increases by about $ 6.8 billion a day, higher than the value of American Airlines

The business activities of Silicon Valley companies are strengthened by the pandemic because people are now almost forced to work and study at home. From April to June, even when many retail stores closed because of the spread of the virus, Apple still made a profit of 11.25 billion USD, up 12% over the same period last year. Having struggled in the US, Apple increased its sales globally.

Mr. Luca Maestri, Chief Financial Officer of Apple, in an interview last month emphasized: “Our products and services are very suitable for everyone’s life. It is even more relevant in everyone. pandemic “.

However, Mr. Maestri also contradicted the notion that the pandemic is making Apple good for business. He affirmed, Apples will also earn billions of dollars if there is no pandemic.

The “money printing” machine

Apple first hit the $ 1 trillion mark in August 2018 after decades of innovation.

The company founded by Steve Jobs and Steve Wozniak in 1976, has produced world-changing products such as the Macintosh computer, the iPod music player, the App Store app store or the iPhone smartphone.

Tim Cook làm gì để biến Apple trở thành cỗ máy “in tiền” vĩ đại nhất lịch sử? - Ảnh 3.

Apple under Tim Cook is considered not as innovative as Apple under Steve Jobs

The New York Times reported that since the first generation iPhone, Apple has almost exclusively “edited” past creations, “sold gadgets” to make a profit with products like the Apple Watch. Series 5, AirPods Pro and iPhone 11 Pro Max.

The company also promotes services such as online music, movies and online TV shows, news sales, card issuance….

Tim Cook has built a huge global supply chain that is enough to manufacture billions of devices, while focusing on a number of product lines to keep customers in its closed ecosystem. Since then, users purchase new devices every few years by themselves and pay monthly fees to use the new services that the company launches.

Apple has been criticized for its monopolistic behavior on the App Store, a significant source of revenue for the company. In order for your apps to be browsed to the store, developers have to pay an annual fee of $ 99 and divide 30% of the app revenue with Apple.

But the bigger problem is that, without approval, the app has no way to reach iPhone users (like downloading via websites or third-party app stores). This is also part of the reason why CEO Tim Cook must have a hearing before the US House of Representatives for monopolistic behavior.

Tim Cook làm gì để biến Apple trở thành cỗ máy “in tiền” vĩ đại nhất lịch sử? - Ảnh 4.

Not as innovative as Tim Cook has turned Apple into the greatest “money printing” machine in history

Besides, Apple has also used another powerful tool to enhance value and enrich investors and executives: stock repurchases.

Since the company’s value reached $ 1 trillion, Apple has returned $ 175.6 billion to shareholders, including $ 141 billion in stock repurchases. Apple has bought back more than $ 360 billion of its own stock since 2012 and is expected to spend more in the future.

Stock repurchases often increase the price of a company’s stock. The reason is that this reduces the number of shares sold. Financial experts say this is an activity that increases inequality that will enrich wealthy investors and executives who are often major shareholders, as is the case with Apple.

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Source : Genk