Apple the culture-changing company behind the iPod, iPhone and iPad hit another milestone on Thursday, becoming the first private-sector company to surpass $1 trillion in market value.
Shares of Apple hit $207.91 in afternoon trading on Wall Street, allowing it to hit the magic number two days after the California tech giant reported strong quarterly earnings.
The landmark is the latest victory for Tim Cook, who faced skepticism when he took over as chief executive in 2011 from ailing iconic co-founder Steve Jobs.
Jobs, who founded Apple in a Silicon Valley garage in 1976 with Steve Wozniak and built it into a global powerhouse, died in October 2011.
After the death of master pitchman Jobs, analysts and other industry watchers wondered whether the company would lose its ability to create buzz for “the next big thing.”
But Cook has gradually won accolades from investors by pumping out a series of solid financial results and spreading Apple’s products to China and other foreign markets.
As with other landmarks — such as the Dow crossing 25,000 points for the first time — the Apple record is significant because of its resonance beyond the financial universe.
“The $1 trillion mark is more psychological, and sends a message of growth and size into the market,” said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. Many financial insiders, however, view the record as a non-event.
“There’s no real excitement on the trading desk,” said Karl Haeling of LBBW. “It’s one of those things that does not mean anything by itself… it’s more a testimony of the importance of Apple on the market.”
Apple is the first private sector company to reach this level. State oil company PetroChina briefly broke the $1 trillion barrier in 2007 during its initial public offering, but has since dropped back down.
US tech companies have cemented their position in the broader market, now making up the top five most valuable enterprises based on share prices.
Behind Apple are Amazon, Google parent Alphabet, Microsoft and Facebook.
– Focus on digital content –
Cook has put a focus on digital content and services, positioning Apple to make money from music, movies, apps, subscriptions and more — all sold to the vast “install base” of people using devices made by the company.
Apple is in the unique situation of controlling the hardware and software in its mobile devices, with content for users required to go through its App Store that takes a percentage of revenue.
Apple has moved to keep up with trends in artificial intelligence and voice-commanded smart speakers, facing formidable rivals such as Amazon, Google, and Microsoft.
Virtual assistant Siri is built into Apple devices including HomePod speakers, tailored to appeal particularly to music lovers.
Apple also boasts the most popular smart watch on the market.
Cook has consistently touted innovations in the pipeline at the famously secretive company.
Last month, an ex-Apple engineer was charged with stealing trade secrets from a hush-hush self-driving car technology project days before he quit to go to a Chinese start-up.
“Apple takes confidentiality and the protection of our intellectual property very seriously,” the company said in response to an AFP query about the case.
The suspect was part of a team developing hardware and software for self-driving vehicles, a project that was a “closely-guarded secret,” according to a copy of the criminal complaint.
– Defending design –
Apple has fought myriad patent battles with rivals, particularly South Korean consumer electronics colossus Samsung.
Apple has argued in court that the designs of its products are as much its intellectual property as are the hardware and software that go into them.
On Tuesday, Apple reported that net profit jumped more than 30 percent to $11.5 billion.
Revenue in the fiscal third quarter soared 17 percent to $53.3 billion from the same period a year earlier due to sales of pricier iPhones, online services and wearable devices.