Three Strong Motivations to Invest in Apple Shares without Delay
Apple's ubiquitous status as a stock suggestion may be a bit worn out, yet it remains a must-have for many portfolios. Let's dive into three reasons why you might want to consider adding this tech giant to yours.
1. Apple's AI is still in its infancy, full potential unseen
While Apple Intelligence was unveiled last year with much fanfare, the interest it garnered was underwhelming. Granted, it saw a launch in October of 2024, around the same time as the iPhone 16, its intended companion. However, the anticipated surge in smartphone demand didn't materialize during the final quarter of 2024. IDC reports a 4% decrease in iPhone unit shipments.
But fear not, for Apple Intelligence isn't down for the count just yet. Consumers are renowned for their need for patience and time to truly comprehend the benefits of new technology. Moreover, Apple's AI platform, with its emphasis on user privacy and on-device processing, sets it apart from competitors who rely on cloud services to handle their AI business. Precedence Research suggests that the worldwide generative AI industry could surge by 44% annually, up until 2034. A promising development for Apple, certainly.
2. Creative thinking: Apple goes off-script to drive growth
Apple never fails to show a flair for the unconventional when the situation calls for it, and this is no exception. To strengthen its AI game in China, the world's largest smartphone market, Apple has forged partnerships that were once considered a no-go zone for the company.
On the 29th of December 2024, Alibaba announced that its AI technology would be at the disposal of iPhone 16 users in China. In the meantime, Apple continues to collaborate with Baidu on AI projects, demonstrating Apple's strategic shift to adapt to the needs of the market.
Similarly, Apple TV+ content is now available on Android devices, allowing a broader audience to enjoy premium content once exclusive to Apple devices. As we've come to expect from Apple, creativity and out-of-the-box thinking are alive and well.
3. Undeniable profit: Apple, a cash cow in the tech industry
Last but not least, there's no denying the profitability and financial muscle of Apple. Despite a slight dip in growth before the pandemic, and a subsequent stagnation, Apple remains the titan of the tech world. Reporting net income of nearly $94 billion in 2022, it is the world's most profitable company.
Apple's considerable cash reserves and near-liquid assets, landing at a staggering $140 billion, allow the company to fund a range of competitive initiatives. To add to this, Apple's stock buybacks have reduced the number of shares available from 26 billion in 2012 to a mere 15 billion now.
In conclusion, despite its current challenges, Apple's AI implementation is still in its infancy, offering significant potential. Its creative approach to market expansion is noteworthy, and while profits may not have soared recently, Apple's financial strength remains intact.
- Despite the underwhelming response to Apple's AI unveiling last year, the anticipation for its full potential remains, especially with the launch of the iPhone 16 in 2024.
- In an effort to strengthen its AI game, Apple has taken an unconventional approach by forging partnerships with Chinese tech giants like Alibaba and Baidu, expanding its AI reach beyond its native userbase.
- Despite a slight dip in growth and stagnation due to the pandemic, Apple's robust financial standing remains unshaken, with a net income of nearly $94 billion in 2022 and $140 billion in cash reserves.
- As a tech giant with significant financial clout, Apple's strategic investments and stock buybacks have reduced the number of shares available, potentially driving investment interest for those looking to benefit from its future growth in 2024 and beyond.
