While Apple still generates ridiculous cash flow, doubters don’t see evidence that Apple still has the innovative juice it needs to dominate not just tech but the global consumer marketplace. In China, where the iPhone is no longer seen as trend-setting.
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Illustration: Sarah Grillo/Axios
(Axios, June 18, 2019, abstracted) A growing chorus of skeptics betting that Apple is headed the way of Blackberry and Nokia. In the midst of the Trump Trade Wars, Apple’s stock price has relied on more than $100 billion in stock repurchases last year.
The Axios piece neglects an underlying political issue. … TRUMP. Contrary to the company hype, Apple has never been an innovator in tech. Job’s skill was in in branding. As the US brand under Trump falls, Apple is a victim. Why buy an iconic American brand when Huawei, Samsung, LG etc. make the underlying tech and carry less affiliated national brands?
The iPhone generates the bulk of Apple’s revenue. But the iPhone is fast losing market share, and Apple services like streaming music, streaming video and home speakers show no signs of generating similar cash flow.
- Apple Watch, AirPods and other “wearables” are buzzy, but account for a fraction of the company’s earnings. Meanwhiletheworldisshiftingto5G, led by China’s Huwaei. Apple is in talks to buy Intel’s modem business to boost its 5G capabilities, but Apple’s failure stake a role in the underlying technology means it will sit out of the first wave of 5G adoption.
Investors have taken notice. Following the company’s first quarter earnings report — which beat expectations, but revealed the steepest decline ever in iPhone sales — Apple became by far the most shorted company in the world, according to data provided to Axios from S3 Partners. Richard Mathes, president of asset manager Mathes Company, dumped all his Apple holdings earlier this year, tells Axios. “They’re going to be a slower growth company going forward.”
Many who follow the tech space are starting to doubt the Apple story.
The problem is that Apple placed its entire supply chain in China. Strategy worked well for 10 years or longer, but the US has done the unthinkable and has confronted China, There were losers in the Opium Wars as well. >China has gotten Hong Kong back, but seems determined to kill the Golden goose.
BS .. Apple’s [rpblme is not whether their things are made in Chins vs Missouri. The porblme is a lack of innovation.