Apple drops new iPhone to tighter wallets

Hey Superheroes,

A rally on Wall Street overnight sent Aussie stocks UP, just in time for the weekend. 

Oh, and multimillionaire property developer Tim Gurner laid off avo-toast eaters this week only to take aim at “arrogant” workers (sigh).

Here’s what the rest of the week had in store for us.

Apple drops new iPhone to tighter wallets

In recent years, Apple’s cash cow has been the iPhone, making up a whopping half of its revenue. But that proportion is dropping.

Its latest Q3 earnings report showed revenue from all its established hardware lines dropped year-on-year.

🤫 iPhone whisperers

But the tone for Apple’s annual ‘Wonderlust’ product release event was ultimately set by share price jitters, when China was speculated to have banned iPhones for government employees last week. 

China swooped in with a statement on Wednesday, clearing the air… sort of. They didn’t ban iPhones, but they did mention some vague “security incidents” tied to them. Hmmm.

🍎 Apple’s balancing act

So other than all this geopolitical tension, what kind of world is Apple’s 15th mobile child being birthed into?

Well, one of tighter wallets, for sure. With prices kept mostly flat across the board, Apple is signaling its awareness of cost-of-living pressures—but at what cost to its margins?

Another potential read is that this protects the accessibility to consumers of the main gateway into the Apple ecosystem.

Maintaining its user base through upgrades is crucial for further growth in its wearables (up 2%) and services (up 8%) divisions, which were the beacons of light in the Q3 earnings report.

TL;DR: Apple’s playing the affordability game without losing its cool factor. They’re making moves to adapt to our budget concerns while still delivering top-tier tech. It’s all in the name of keeping users firmly rooted within the Apple realm.

Will you be among the upgraders, or does Apple need a new iPhone strategy?

🔦 Some other things we’re shining the Spotlight on:

• TESLA’S GRIN: There’s a United Auto Workers union strike in the U.S. at the moment that’s hitting GM and Ford. We all know Elon Musk isn’t the biggest fan of unions, but he might just be cheering from the sidelines in this instance. Automakers could face higher costs and complexity in the future that wouldn’t impact EV makers. (Tesla plants aren’t unionised, so Musk is also benefiting from its continued operations.)
• 420 IN THE USA: Cannabis ETFs are lighting up right now. After drawn-out uncertainty for the industry, The U.S. Department of Health and Human Services just gave the Drug Enforcement Agency a nudge to ease restrictions. Canopy Growth (CGC) was up 68% this week and made its way into our Top Traded U.S. Stocks list.
• GOODBYE YELLOW BRICK ROAD: Celebrity Apprentice Australia host Mark Bouris hit the pause button this week on his mortgage business Yellow Brick Road. The stock entered a trading halt on Thursday and will seek to delist from the ASX. No reasons have yet been given for the decision. But YBR reported an after-tax loss of $3.5 million in 2023, with settlements down 7% on the last financial year. Shares are currently down over 35% YTD.
• MY-OH-MYER: Department store chain Myer posted its best profit in 18 years yesterday. Because Myer made $3.4 billion in the last financial year, and saw profits go up by 23%, shareholders can expect to receive a final fully franked dividend of 1c per share on 16 November.

That wraps up another weekly Spotlight.

Thanks to all of you for being here and reading!