Apple’s share price continued its swift rise on the first day of trading in 2022, with it becoming the first publicly traded company in the world to be valued at $3 trillion.
After briefly hitting the milestone in afternoon trading, the company’s market capitalisation ended the day at about $2.9 trillion as its share price dipped.
The iPhone maker’s share price tripled since end-2017, surpassing the $2 trillion mark in 2020. It was the world’s first $1 trillion company in August 2018.
Apple’s market value has grown by almost $2.7 trillion in a decade under Tim Cook’s leadership, after he succeeded late company founder Steve Jobs.
In fiscal Q4 2021 (25 June to 25 September), iPhone sales rose 47 per cent to $38.9 billion, with total company net income soaring 62 per cent year-on-year to $20.5 billion.
Apple’s shares have climbed around 5,800% since co-founder and former CEO Steve Jobs unveiled the first iPhone in January 2007, far outpacing the S&P 500’s gain of about 230% during the same period.
Under Tim Cook, who in 2011 became CEO following Jobs’s death, Apple has sharply increased its revenue from services like video streaming and music. That helped Apple reduce its reliance on the iPhone to about 52% of total revenue in fiscal 2021 from over 60% in 2018, pleasing investors worried the company relied too much on its top-selling product.
Still, some investors worry Apple is hitting the limits of how much it can expand its user base and how much cash it can squeeze from each user, with no guarantees that future product categories will prove as lucrative as the iPhone.
The rapid embrace of technologies such as 5G, virtual reality and artificial intelligence has also increased the allure of Apple and other Big Tech companies.
In China, the world’s largest smartphone market, Apple continued to lead for the second straight month, beating rivals such as Vivo and Xiaomi, recent data from CounterPoint Research showed.
With Tesla now the world’s most valuable automaker as Wall Street bets heavily on electric cars, many investors expect Apple to launch its own vehicle within the next few years.
“The icing on the cake, which may turn out to be the cake, is the potential for an EV,” Rhys Williams, chief strategist at Spouting Rock Asset Management, said.
Just as Apple’s market capitalisation hits the $3-trillion milestone, its share price as a percentage of the Nasdaq 100 index’s value is bumping up against a key technical level. In recent prior times, the stock price has risen above such a level and then subsequently declined.