Text: Li Xiaolu
On January 4, Beijing time, Apple's stock price reached a new high of $182.88, and Apple became the first company with a market value of $3 trillion. Apple's current market value has surpassed the UK's 2020 GDP, and it is justifiably the "fifth largest economy in the world". At the close of trading on January 3, US time, Apple's stock price rose 2.5%, closing at 182.01 yuan. Apple's market value of three trillion yuan is equivalent to the market value of 7.3 Moutai or 24 China Mobile, which is about 19.06 trillion yuan.
Let's look back at Apple's 3 trillion yuan of creation and Apple's nearly 40 years of ups and downs
Apple went public for the first time in 1980, the highest IPO at the time at $1.79 billion.
In 1985, founder Steve Jobs was ousted by Apple and founded NeXT and released the official version of the first computer.
In 1996, Apple's stock price plummeted to $14, and Apple spent $492 million to acquire NeXT. Jobs became the official CEO of Apple in his fourth year after his return, during which time he released the iMac and Mac OS X operating systems.
Apple's stock price fell 71 percent in 2000 due to the dot-com bubble that shook the West. Between 2000 and 2007, he experienced the launch of the iPad project and the diagnosis of Jobs's pancreatic cancer.
Jobs released the iPhone in 2007, with a total of 30 million units sold. Since the launch of the first iPhone in January 2007, Apple's stock price has risen by a cumulative 5,800 percent, far exceeding the 230 percent increase in the S&P 500 over the same period.
In August 2011, Cook served as CEO with a market capitalization of $300 billion.
In 2012, Apple ranked first in the world with a market capitalization of $520 billion.
Cook came to China in 2013 to emphasize the importance of the Chinese market.
In 2014, Apple's market capitalization exceeded $700 billion.
At the end of 2017, Apple's market capitalization reached $860 billion.
In August 2018, Apple's market value exceeded one trillion yuan for the first time.
In 2020, Apple became the world's first company with a market capitalization of more than $2 trillion, and at the end of August 2021, Apple's market value exceeded $2.5 trillion. During this period, Apple has been constantly innovating, launching a series of new products and new projects, Apple entering the Chinese market and changing the technology industry. From Apple to break through the trillion to three trillion in just 2 years, its growth rate is surprising, Apple's market value seems to have a trend of not capping.
What does it mean that Apple's market capitalization is over $3 trillion?
Apple can stand out as a benchmark in the ocean of technology, and the market value of three trillion US dollars makes global technology salivate. Some people think that this is just a temporary bubble of prosperity, but after looking at the history of Apple's development and its various performances, behind Apple's prosperous scene is not a void of high, which can make the capital market so optimistic, can maintain a huge and stable economic performance, and can be loved by the majority of people at home and abroad because of its unique nature.
"Technology is the first productive force" will express Apple's life vividly, and it is undeniable that the experience brought by Apple products to people is excellent. Apple has placed marketing on the back burner since its inception, and productivity has always been its irreplaceable reason. The configuration of any of Apple's products is non-market-oriented, Apple uses highly customized software and hardware underlying technology, and the strong confidence comes from self-developed chips, self-developed algorithms, and special components and operating systems. Of course, self-sufficiency like Apple is undoubtedly not the yearning and pursuit of other technology companies, but this is indeed a gap that must be unattainable. Whether it is the "lack of core tide" or the epidemic, Apple has not been greatly affected. Its strong supply chain and capital chain is that it can also stand firm in the face of difficulties when experiencing strong winds and waves.
First of all, looking back at Apple's cash flow data in the past 15 years, we can see that Apple has been showing a steady growth trend since 2006, and its cash flow has stabilized at more than 50 billion yuan since 2014. At the same time, the domestic technology circle is also performing well, such as Tencent's cash flow in 2020 reached $23.4 billion, Xiaomi's is about $16.6 billion, but their stock prices are constantly fluctuating. It can be seen that Apple's huge and stable cash flow has achieved its high level in the capital market, of which "stability" is the key, which makes Apple not bankrupt even if it faces a huge threat to the external environment.
▲ 2005-2021 September 30, Apple cash flow statistics, unit: millions of dollars, source: macrotrends
In addition, Apple has huge cash flow and will also use cash flow to make the business ability perform extremely well, which is also the key to continuously pushing up its stock price and market value.
In the decade since 2012, Apple has used stock buybacks as its main business method. By reducing the number of shares in circulation in the market through repurchases, the stock price and stock returns are increased, and then returned to shareholders to form a positive return after the stock price rises. As a result of this virtuous circle, as of 2022, Apple has spent $467 billion on repurchases, becoming a well-deserved "big buyback".
Toni Sacconaghi, an analyst at asset management firm Bernstein, expects Apple to continue to buy back shares over the next five years, buying back 3-4 percent of its shares each year until the end of 2026. Second, the intrinsic supply is the cornerstone. I don't know whether it is the attraction of Apple's unique business philosophy or its very considerable profits, Apple's suppliers such as Texas Instruments, Lens Technology, Qorvo, Corning and other companies' market capitalization is mostly showing a high-speed growth trend, so Apple's supply team for Apple can be described as dedicated, to provide professional and customized services, solid supply team has also achieved a solid strength of Apple technology.
Apple is still on the way, how far can it go?
Science and technology is a symbol of a country's strength, Apple plays an immeasurable role in modern science and technology, and science and technology divide national boundaries, and now Apple is also facing the impact of more and more policy factors, Apple's excellence is obvious to all, we should have an open mind to learn its superiority and continuously develop China's science and technology. At the same time, many Chinese people also have the attitude of "supporting domestic products", which is a sense of confidence and pride from the patriotism of the Chinese people, and should be supported and protected. Apple's three trillion road may just be a node, in the face of future technology, Apple still has the strength and prospect of technology giants, how far do you think Apple can go to the future?