Generally speaking, these are troubling times for tech companies. Facebook and Twitter have had to deal with questions about the spread of fake news and what steps they’ll take to police people’s content. Microsoft has been worried about its products becoming obsolete. It’s a turbulent era for everyone. One tech titan just continues chugging along, though, and that’s Apple. According to the New York Times, profits are pouring in for the Cupertino, California-based giant, and the company may soon reach a total value of over $1 trillion.
Apple has always been able to make money, but 2018 has been especially strong. The company said its profits in the most recent quarter came in just over $11.5 billion, which was more than 30 percent better than the same time period a year ago. The company has always had success selling iPhones and other cutting-edge gadgets, and it looks now like that success has reached an entirely new level. In three months, the company has sold 41.3 million phones. That’s despite the fact that iPhones cost nearly 20 percent more than they did a year ago, thanks to the new iPhone X and its sticker price of a cool $1,000.
“That’s a sign that the iPhone X, despite its high price, is resonating with consumers,” said Toni Sacconaghi, an analyst at Bernstein Research.
It’s been a remarkable turnaround for Apple. Two decades ago, it appeared that the company was on the brink of going bankrupt: interest in the Macintosh computer had dried up, and the brand was desperate to reinvent itself. Then came a series of innovations. The iPhone was just one of them. The company also found success by marketing its mobile apps, data storage, and other services that had real value in the 21st century. As a result, the company’s value has soared again.
Not only is Apple raking in profits, but the business is also incredibly flush with cash, which bodes well for the future. The Times reported that Apple is currently sitting on $243.7 billion; it may choose to return a significant chunk of this money to investors, buying back stock and driving up the value of the remaining shares. This would be a big reward for the company’s investors.
“They have so much cash and so much buying power, they can synthetically support the stock,” said Sander Read, chief executive of Lyons Wealth Management. “So it’s very hard to bet against.”
Photo: A person holds an iPhone X, by Halfpoint / Shutterstock.com