Apple profits fall for the first time in a decade …
by Lorena Unaza
(Information are based on an article by Rory Cellan-Jones: /www.bbc.co.uk)
Concerned investors have been wondering about the Apple’s future as the company has reported its first quarterly drops in profits after a decade. Tim Cook is convinced that Apple will raise dividends for shareholders and the next few months will be a creative period for the teams, already working hard to create a new product.
Apple is a market dominating company in tablet computers and smartphones, it has declared to have sold 37.4 million iPhones and 19.5 million iPads worldwide in the three-month period.
However, investors started to worry when Appel’s global market share went down, first of all Samsung gained ground. In addition, investors are looking for innovation and new cool features from all competitors. That was the reason Apple´s stock market value went down by 40% the previous months compared to last year’s value. Many analysts re-commanded launching new products, „just updating already existing products Made by Apple is not a long term solution.“
Tim Cook makes clear Apple is creating amazing new hardware and software, it all will be presented in a few months. “It always takes a very long time between the inception of an idea and commercialising a product. What no investor can see is what is happening between closed doors in research and development,“ said David Tan, assistant professor of strategy at Georgetown University.
During this summer the Apple’s investors have to make up their mind and to test their patience. Apple, before the latest earnings had $13bn in cash, has been now under pressure to share some of it with shareholders. On Tuesday it was declared that Apple is going to rebuy $60bn in shares and will raise its dividends to shareholders by 15%. This declaration encouraged investors and Apple’s shares rose 5.5% some hours after trading in Wall-Street.
The views expressed on austriancenter.com are not necessarily those of the Austrian Economics Center.
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