24/7 Wall St. Insights
- Apple Inc. (NASDAQ: AAPL) has warned that it may suffer a decline in profit, particularly on new products.
- This tells investors that the recent near-record report could be a high-water mark.
- Also: Dividend legends to hold forever.
In the “risk factor” section of its annual report (10-K), Apple Inc. (NASDAQ: AAPL) said it may suffer a decline in profit, particularly on new products. Gross profits have long made Apple attractive to investors.
The report says, “New products, services and technologies may replace or supersede existing offerings and may produce lower revenues and lower profit margins.” These, in turn, could affect “business results.”
Risk factors are part of all publicly traded company major filings, especially 10-K filings. However, management includes all the hurdles a company can face. They are an early warning system that investors can ignore or not.
Apple has invested heavily in its new products, particularly artificial intelligence. In this way, it is similar to any huge tech company, all of which are in the AI race. Meta and Microsoft, in particular, said these investments would be in the billions of dollars and would push up spending.
Apple’s gross profit is near record levels. In the most recent quarter, the figure was 45%, which is relatively flat compared to the previous two quarters. However, it has grown from 40% in 2020. Apple’s risk factors tell investors that the recent level could be a high-water mark.
Apple Stock Price Prediction and Forecast 2025-2030
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
