Apple is a safe port in the storm; stock surges after record earnings report

Shares of Apple were up more than 5% in trading on Friday morning, the day after Apple posted all-time record fourth-quarter earnings that showed annual sales growth of 8%.

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Kif Leswing for CNBC:

“Apple looks like a” relatively safe haven in the storm, “Credit Suisse analyst Shannon Cross wrote in a statement Friday.

But this week, investors fled from other Big Tech stocks. Microsoft and Alphabet had their worst days of the year on Wednesday. On Thursday, Meta had its second worst day, plummeting 24% at prices it hasn’t traded at since 2016. And Amazon dropped around 10% Frida morning after reporting gains on Thursday.

But now Apple looks much more stable than its peers, especially as fears of a recession begin to weigh on ad sales and potential holiday spending. It’s largely because Apple relies on hardware and services that people are still buying.

And Apple has managed to do so as the largest phone and PC industry has seen big declines. Worldwide smartphone shipments fell 9% during the third quarter, while Apple’s shipments increased 8%, despite its more expensive devices, according to an estimate by research firm Canalys this week.

“The demand for premium devices remains intact,” Cowen’s Krish Sankar wrote in a statement Friday.

In short, Apple’s business remains strong and demand for its products remains high across the globe, including in emerging markets, bucking the downtrend for global sales of other brands’ smartphones.

“Following Apple’s F4Q22 results, it remains our first choice and, we believe, will likely remain a relatively safe haven for many as the macro environment remains highly uncertain and unstable,” said Cross, of Credit Suisse. Cross added that Apple’s results showed that the company continues to grow in every region it sells in, despite recent price hikes and weakening consumer sentiment.

Apple’s quasi-driving was also largely in line with expectations …

MacDailyNews takes: As we wrote before Apple’s earnings report:

Apple iPhone customers are the most recession-proof smartphone buyers. – MacDailyNews, September 7, 2022

The same goes for Mac, iPad, Apple Watch, and Apple Services customers on personal computers, tablets, smartwatches, and subscriptions, respectively. – MacDailyNews, October 13, 2022

The big tech company most resilient to inflation and recession is Apple, thanks to its superior customer demographics. – MacDailyNews, October 27, 2022

When your money becomes a major concern, you want to spend it wisely. In China and everywhere, if it’s not an iPhone, it’s not an iPhone. Also, if it’s not an iPhone Pro, it’s not an iPhone Pro. – MacDailyNews, October 27, 2022

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