Apple Inc (AAPL) has seen $1 trillion in market value wiped out in just one year, joining Amazon which became the first public company to ever lose more than $1 trillion in value in November 2022.
In trading on Tuesday Apple’s market cap fell below $2 trillion for the first time since early 2021 and one year to the day after the company became the first public tech company valued at $3 trillion.
Only a year ago Apple was celebrating becoming the first US firm to reach a market value of $3 trillion. However, a different story has emerged 12 months later, with Apple shares plunging by more than 4 per cent leaving the tech giant to move into 2023 with a market value below $2 trillion for the first time since early 2021.
Similar to other hi tech focused companies, Apple has had to contend with issues in its supply chain and worries that economic worries might have an impact on advertiser and customer expenditure, including for more expensive items such as the iPhone.
This week’s decline in share prices was the result of a Nikkei Asia report that raised worries about the demand for Apple products.
According to the report, Apple supposedly contacted suppliers to ask them to produce fewer components for certain highly popular items such as AirPods, Apple Watch and MacBooks.
Over the course of the past year, Apple’s market capitalisation has decreased significantly, yet other major tech organisations have experienced an even greater drop in percentages.
Amazon and Meta (the parent company of Facebook) shares had fallen around 50% and 63%, respectively, over the last year. By comparison, Apple went down by about 31% over the same period.
Recently, investors have been concerned that Apple may not be able to fulfill demand for certain products due to the disruption of production and supply chains caused by the Chinese government’s Covid-related lockdowns and policy changes.
Towards the end of 2021 an insider with knowledge of the situation alleged that Apple was likely to encounter a dramatic deficit of six million iPhone Pros, their best selling product, due to the disruption caused by the Covid pandemic in China.
In November, Apple acknowledged that the chaotic situation had a negative effect on the production of goods prior to the important Christmas holiday shopping season and warned that it could lead to delays.
When trading ceased on Tuesday, the price of Apple shares had plummeted to a mere $US125 ($A185), significantly lower than the $US182.94 ($A270.40) they were worth a year ago.
Apple has now joined Amazon in the only list of companies that have lost $1 trillion in market value.
