The stock price of Apple has dropped more than 4% in the last day, wiping off more than $100 billion of its market value. The one-day drop is greater than the combined worth of Ford and GM. Sluggish sales of the $1,599 iPhone 15 prompted Barclays to downgrade the shares on Tuesday, citing concerns that the next model, coming in September, will also disappoint. The stock dropped about 4% immediately, and it is presently trading near $184, a seven-week low, after previously trading above $192. According to Refinitv statistics, Apple’s valuation plummeted by $107 billion.
Barclays believes Apple shares will fall to $160 and advises customers to liquidate any stock they own
AirBnB, FedEx, Citigroup, and Starbucks are all less valuable. Ford and GM, previously two of the world’s largest corporations, are not worth that much. Barclays believes Apple shares will fall to $160 and advises customers to liquidate any stock they own. According to Barclays analyst Tim Long, Apple’s iPhone 15 smartphone sales have been “lacklustre,” and the next iPhone 16 “should be the same.”‘ ‘We see no improvements or changes that will make the iPhone 16 more appealing,’ the letter continues.
Mac laptops and iPad sales were also disappointing, and revenue from services – like fees for iCloud, Apple TV+, and Music – are not projected to increase by more than 10%. ‘We expect [the share price] to revert after a year in which most quarters were missed and the stock outperformed,’ Long said. Apple’s stock soared 50% last year to a record high, giving it the first firm with a market value greater than $3 trillion. It was initially reached in June, and then again in early December, when shares were trading above $193.
According to analysts, Apple’s biggest challenge is declining Chinese sales. This is occurring for two primary reasons. Chinese rivals such as Huawei are gaining market share, and Beijing has placed restrictions on government employees’ use of iPhones. According to Bloomberg, the smartphone research firm IDC has reduced its 2024 projection for Apple’s China sales. ‘Huawei’s performance has the greatest impact on Apple’s growth in China,’ said Nabila Popal, research director at IDC.
Huawei’s market share of high-end smartphones increased to 24% in the third quarter of 2023
Huawei’s market share of high-end smartphones increased to 24% in the third quarter of 2023, up from 11% the previous year. The head of financial analysis at AJ Bell According to Danni Hewson, Americans are spending less as well, which hurts Apple. ‘Once again, Chinese competition is a factor,’ she explained to Business Insider, ‘but as high-interest rates do the job they were designed to do and consumers continue to think carefully about big-ticket purchases, tech like iPhones are the ultimate nice to have that many potential customers may end up putting off buying until their budgets are less constrained.’
Tensions between the US and Chinese governments have had an impact on Apple’s intentions in various ways. The IT titan has begun to shift iPhone production away from China, to have one in every four built in India by the end of the year. Firms have grown increasingly concerned about their overdependence on China, fuelled by diplomatic attempts by the US and its allies to prevent Beijing from gaining access to breakthrough technology.
