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Apple soars past US$1tn in value

LANDMARK?While Apple’s CEO called it a ‘significant milestone,’ some financial insiders viewed the record as a ‘non-event,’ with little interest on the trading desk

AFP and Reuters, NEW YORK

The Apple Inc logo is displayed on a monitor outside the NASDAQ MarketSite in New York on Thursday.

Photo: Bloomberg

Apple Inc — the culture-changing company behind the iPod, iPhone and iPad — on Thursday hit another milestone, becoming the first private-sector company to surpass US$1 trillion in market value.

Shares of Apple finished the formal Wall Street trading day at US$207.39, topping the magic number two days after the California tech giant reported strong quarterly earnings.

Apple is the first private-sector company to reach this level. State oil firm PetroChina Co (中石油) briefly broke the US$1 trillion barrier in 2007 during its initial public offering, but has since dropped back down.

Billions of US dollars that Apple has been spending to buy back shares was thought to have helped propel the company past the US$1 trillion mark.

Apple CEO Tim Cook said that the company’s market capitalization was “not the most important measure” of the company’s success, but was instead a result of its focus on its products, customers and company values.

In a memo to Apple’s more than 120,000 employees, Cook called the valuation a “significant milestone” that gave the company “much to be proud of.”

However, he said it should not be the company’s focus.

“Financial returns are simply the result of Apple’s innovation, putting our products and customers first, and always staying true to our values,” Cook said.

Apple was founded in the late 1970s by Steve Jobs and went public in 1980 after helping usher in the era of the personal computer. One of three founders, Jobs was driven out of Apple in the mid-1980s, only to return a decade later and rescue the computer company from near bankruptcy.

In the two decades since, Apple has risen to become the most valuable company in the world by helping popularize yet another era in computing, the smartphone. The iPhone, introduced by Jobs in 2007, has sold more than 1 billion units.

In his memo, Cook referred back to Jobs, who died in 2011.

“Steve founded Apple on the belief that the power of human creativity can solve even the biggest challenges — and that the people who are crazy enough to think they can change the world are the ones who do,” Cook said. “Just as Steve always did in moments like this, we should all look forward to Apple’s bright future and the great work we’ll do together.”

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.com Inc, Google parent Alphabet Inc, Microsoft Corp and Facebook Inc.

A trillion dollars is roughly the annual GDP of Indonesia, and more than twice that of Belgium, World Bank data from 2016 showed.

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 US$1 trillion mark is more psychological, and sends a message of growth and size into the market,” S&P Dow Jones Indices senior index analyst Howard Silverblatt said.

Yet many financial insiders 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’s valuation defied financial trends in recent quarters and potential defeat in a legal battle with Qualcomm Inc over mobile chips, independent technology analyst Rob Enderle said.

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