Apple in crisis… For now

August 16 2023

Earnings for Apple & Amazon released recently saw Amazon shares close more than 8% higher, whilst Apple suffered a 4.8% slide. Amazon’s shares closed near a one-year high, adding more than $109 billion to its market value whilst Apple fell to a more than one-month low, losing around $144 billion at the recent Friday close. The charts below illustrate how both companies’ share prices fared, and the change in various key investment ratios and measures.



Although Apple generated $81.8 billion in revenue this quarter, their drop from $83 billion in the previous quarter represented their third consecutive quarter of annual revenue decline, for the first time since 2016. This decline has been mainly prompted by decreasing sales in iPhones and iPads.


Amazon on the other hand, reported net sales this quarter of 134.4 billion dollars, an 11% increase, marking their largest earnings beat since the 2020 fourth quarter reports; when increased remote work prompted by COVID led to a significant boost. Amazon also confidently released projections of expected sales between 138 and 143 billion in Q3, representing between 9% and 12% growth in percentage terms, where analysts have only forecasted a maximum of 138 billion.


Apple’s downside move was further fuelled by their CFO’s projection of revenue decline in September. However, it must be remembered that Apple now has twice as many subscribers than Disney, HBO, and Netflix combined.


This diversification aligns with its launch of an exclusive WeChat store for its products, expanding retail avenues as Chinese smartphone sales begin to slow. With respect to China, the iPhone 13 climbed to become the best-selling smartphone, though weakening consumer confidence recently dampened smartphone sales.



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