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On August 24, 2011, Steve Jobs submitted his resignation to Apple's board of directors, and Chief Operating Officer Timothy Cook succeeded him as Apple's new CEO.
Two months later, Cookdai stood at Apple's new product launch for the first time and officially released the iPhone 4s. On that day, Apple closed at $666.8 and had a market capitalization of just $330 billion.
In the following 10 years, Apple's stock price rose steadily under The leadership of Cook, and its market value repeatedly reached new highs.
In the summer of 2018, Apple's market capitalization entered the trillion-dollar club for the first time. Two years later, Apple's market capitalization doubled to more than $2 trillion. Just after the new year of 2022, Apple once again made history, becoming the first company in history to have a market value of more than $3 trillion.
Chart: Apple's 10-year stock price chart (formerly reversed) vs S&P 500 index
Cook's efforts
Back in 2011, when Apple fans learned that Cook would succeed Jobs as CEO of Apple, most of them held a pessimistic attitude of "Apple is dead". An executive with a background in management and operations will not have jobs insight and cannot design products that disrupt the industry. Cook has also publicly stated that he is good at corporate operations and supply chain management. He even told the media: "I know what I'm going to do is not imitate him, that would make me lose." I think a lot of people who take over from great predecessors will encounter a similar situation. You have to plan your path and you have to be the best version of yourself. ”
He did. He didn't become the second Jobs, but he made Apple the most profitable company on Wall Street and Silicon Valley.
Cook, who came from a supply chain background, led Apple to move its production base to Asia. Cook insists that the bulk of what high-tech companies spend is on parts procurement and managing service supply chains and the formation of hundreds of companies, while factories in Asia "scale up or down faster" and "supply chains in Asia are stronger than in the United States." Foxconn from China has since become Apple's largest foundry partner in the production transfer.
During Cook's tenure, there were no major changes to Apple's most important product line, the iPhone. Instead, it chose to expand the original single model. In 2014, Cook ruled out controversy to launch the expanded size iPhone 6, a phone that helped Apple become the world's most profitable company in 2014. Apple also launched the SE series, targeting users who like the iPhone but are afraid of the price. Subsequently, a series of models such as the iPhone Pro and iPhone Pro Max greatly met the needs of potential consumers.
In addition, Cook has spared no effort to drive revenue growth from Apple's software and services. In 2016, Apple surpassed the Mac for the first time in services revenue, becoming the company's second-largest revenue source after the iPhone. By 2021, the share of software and services revenue has reached 18%, far exceeding the revenue of Macs and iPads.
During Cook's tenure, in addition to expanding the iPhone product line, the Apple Watch launched in 2015 and the AirPods launched in 2016 allowed Apple to gain new growth points on wearable devices in addition to mobile phones and computers.
In fiscal 2012, the first full year after Cook took office, Apple had revenues of $156.5 billion and net profits of $41.7 billion. By fiscal 2021, Apple had $365.8 billion and a net profit of $94.6 billion.
Chart: Apple Revenue Change (FY2012-FY2021)
Compared with the changes in Apple's revenue structure after Cook took office 10 years ago, the proportion of iPhone revenue has been relatively stable. The share of Macs and iPads launched during Jobs's tenure continued to decline, while the share of software and services revenue rose sharply. In addition, the proportion of revenue from new products, mainly wearable devices, has also doubled. Among them, the Apple Watch and AirPods launched during Cook's tenure are indispensable.
Table: Changes in Apple's revenue composition
Bet on China
Jobs never visited China before he died, but Cook did the opposite, visiting China frequently. Public data shows that Cook has visited Chinese mainland 15 times since he became CEO of Apple. The number of Apple retail stores reflects Cook's emphasis on the Chinese market from another side. During Cook's tenure, Chinese mainland Apple stores have grown from a few sporadically at first to the latest 43. In addition, from the list of 200 suppliers released by Apple, the number of Apple suppliers in Chinese mainland + Hong Kong has increased to 51, becoming the country with the largest number of Apple suppliers.
Apple's sales in Greater China also rose from $25.4 billion in fiscal 2013 to $68.36 billion in fiscal 2021.
Chart: Apple's Revenue Growth in Greater China (FY2013-FY2021) (in US$ 100 million)
The outside world is curious about why Cook comes to China so often, and Cook has been silent about it.
Until December 2021, the technology media The Information released a report describing Cook's efforts for Apple's development in China, thus paving the way for Apple's brilliant achievements in China.
The report cites apple internal documents and interview quotes about Cook's multiple visits to China in 2015 and 2016 and a series of commitments to the government, including helping Chinese manufacturers develop "state-of-the-art manufacturing technologies" and "supporting the development of high-quality Chinese." In addition, Apple has pledged to use more components from Chinese suppliers in its devices, sign agreements with Chinese software companies, cooperate with Chinese universities in technology, and directly invest in Chinese technology companies. At the same time, Apple has pledged to reinvest "billions of dollars" in projects that include building new retail stores, research and development centers and renewable energy projects.
Chart: Apple's Revenue Share in Greater China (FY2013-FY2021)
Superb financial skills
In addition to the continuous improvement of operating data, Apple's superb financial skills are also indispensable to the company's market value growth.
During Jobs's tenure, Apple never paid dividends, and even as its stock price continued to rise, Wall Street referred to Apple as the "Iron Rooster." After Cook took office, he changed Jobs's "miserly" style, not only continuing to pay dividends, but also frequently buying back shares.
Apple began paying quarterly dividends and buying back shares in March 2012. According to S&P Global Market Intelligence, Apple has spent more than $450 billion on stock buybacks since then and through the summer of 2021. In fiscal year 2021, which ended last September, Apple spent a total of $85.5 billion to buy back shares and paid $14.5 billion in dividends.
Over the past 10 years, Apple has consistently topped the list of major U.S. public companies in terms of the number and amount of shares repurchased. By buying back shares and dividends, Apple actively reduces the supply of outstanding shares in the market to push up its own stock price and return funds to investors.
In addition to buybacks and dividends, Apple split its shares twice in June 2014 and August 2020. The company's stock price has been significantly reduced and has gained the favor of more small and medium-sized investors.
Who makes a lot of money?
Apple's market capitalization continues to rise, and all shareholders and employees are benefiting.
Just this month, CEO Tim Cook received his total compensation for 2021: $98.7 million. Of that, $82.3 million in stock compensation was apple to reward him for his contribution over the past 10 years.
Over the past 10 years, Vanguard and BlackRock, as well as Berkshire Hathaway, have been the biggest winners of Apple's stock price rally.
BlackRock became Apple's majority shareholder in 2012 with a 5.3% stake, and its latest holding market capitalization reached $187.5 billion. Pioneer surpassed BlackRock in 2014 with a latest shareholding of 7.46% and a market capitalization of $223.8 billion. Compared to their initial investment amount, it is very profitable.
From the first quarter of 2016, Buffett's Berkshire Hathaway began buying Apple shares, opening about $1 billion for the first time, when Apple's stock price was between $90 and $100. In the following two years, Buffett has increased his holdings in Apple stock many times. On June 30, 2018, Berkshire Hathaway's holdings increased to 255 million shares, exceeding 5% for the first time to 5.2%. Based on Apple's highest market capitalization of $3 trillion, Berkshire's stock market value reached $160 billion. With a profit of more than $120 billion, it became Buffett's most profitable investment.
Where is the future?
In the past 10 years, Apple has not launched a single electronic product as epoch-making as the iPod, iPhone or iPad. Every year at the new product launch, Cook pulled out of his pants pocket, is boring new generation iPhone, even if they have better screens, better pictures, better cameras.
Although the Apple Watch and AirPods hits helped Apple rush to a $3 trillion market cap, everyone knows they can't afford Apple's future. What determines whether Apple can go to the next level may be meta-universe products and Apple cars.
Cook never discussed in public what Apple had to do with the metaverse. He even said that Apple will stay away from the buzzwords, but that doesn't stop Apple from its crazy investment in virtual reality (VR) and augmented reality (AR).
In the past 10 years, Apple has successively acquired ten AR/VR companies, involving sensors, AR software, AR content ecology and even AR lenses, including Swedish facial recognition technology company Polar Rose, Israeli real-time 3D motion capture company PrimeSense, German augmented reality technology company Metaio, Swiss facial recognition technology company Faceshift, NextVR, VR startup Spaces, etc.
At the same time, Apple has also applied for many related patents, and Apple has been disclosed no less than 100 related patents and functions, and Apple has won 11 AR-related patents in 2021 alone.
According to Bloomberg's report, Apple is currently researching two devices: one is a VR device with an internal codename of N301, with movie-watching, gaming, and social capabilities, which will be available as early as 2022; the other is an AR glasses with an internal codename of N421, which is still in the underlying technical research stage, and the release time may be in 2023.
Tianfeng Securities analyst Guo Mingqi also released a report, saying that Apple will launch AR/VR headsets in the fourth quarter of 2022. All indications are that Apple's AR/VR devices are not far from being available.
Analysts at Morgan Stanley even say that Meta and Google have been investing in virtual reality (VR) and augmented reality (AR) technologies, which are gateways to virtual worlds in the "metacosm," but that ar/VR mass market applications will only be possible when Apple joins the track.
Compared to the imminent arrival of hardware products, there has been no exact news about the stage of Apple's progress in the metaverse of software and content. Hardware plus operating system, as well as ecology, is Apple's killer of the mobile Internet.
The answer to how far Apple can go in the metacosm may need to wait until Apple's first device hits the market.
Compared with the layout of the meta-universe, Apple's car is up early in the morning, and has been on the way to the market, and even does not know whether it can arrive before the market is disbanded.
In 2008, Jobs had planned to develop its own car brand iCar. By 2014, Apple launched a high-profile car project and named it "Project Titan." In a way, the "Titan Project" is the "last wish" of Apple's soul figure Jobs.
Subsequently, Apple formed a luxurious team of about 200 people. In order to build a car, Apple does not hesitate to use huge resources to dig corners everywhere. Chrysler, Tesla, Ford and other companies of power testing and hybrid electric system engineers have been poached, and because of Apple's fierce poaching, Tesla CEO Musk even publicly mocked Apple in 2015, calling Apple "Tesla's grave" - all Tesla talents poached by Apple will go to mediocrity, and even companies and Apple have fought poaching lawsuits.
8 years have passed, Apple's car-making head has changed one term after another, the car-making thinking has oscillated between the whole vehicle and the software, and the car-making route is also entangled between self-manufacturing and OEM, but even a car has not appeared in front of the public. Even Kuo, who has always been optimistic about Apple, believes that Apple will not launch a car soon, and if everything goes well, it will take until 2025-2027.
In 2014, Tesla's sales were 31,655 units. In 2021, Tesla's global sales have reached 936172 vehicles.
If Cook has done anything wrong in the past 10 years, it must be that Apple's car has not landed. Everyone knows that Apple is building cars, and everyone knows that Apple can build cars. But whether Apple can make a post-attack on the track of car building, like Jobs in the era of smart phones, many people do not seem to be so optimistic.
If one day, Cook drives an Apple car to appear at apple's new product launch, perhaps Apple's stock price will rise more confidently.
Cook once said: "Some people think that innovation is change, and we never see it that way." I think what makes things better is innovation. ”
Good luck to him.
Editor: Wan Jianyi
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