Apple’s market value dropped below $2tn over Christmas. What’s gone wrong?

Apple’s stock price has taken a battering and the previously untouchable giant of smartphones has an uncertain 2023 ahead

Apple’s market value dropped below $2tn over Christmas. What’s gone wrong?

Apple have seen $1tn wiped off their previously record-setting $3tn market-cap. Issues with manufacturing and the general global forecast of a recession have greatly impacted investor faith for what has, for many years, been one of the more steady and predictable tech performers. For many the recent wobbles are a sign that the absolute dominance of the company that arguably popularised the smartphone could be coming to an end.

It’s important to note that such stock worries are not solely isolated to Apple. Other major tech companies have been seeing devaluation of their stock. Whether that’s due to the current economic circumstances or other issues, such as with Tesla where the behaviour of its owner Elon Musk – accused of taking his eye off his prize in favour of new love Twitter – has gone some way to devaluing the brand.

That said, Apple’s worries are nothing but predictable.

China as the weak link?

China would appear to be the weak link for Apple. The country has of course been a major centre for tech manufacturing with Apple practically coining the mass production methods required to get major technology advancements into as many global hands as possible. However, due to zero-covid lockdowns and a lack of anticipation of these regulations has meant that companies have struggled with throttled supply chains. If anything, the pandemic showed the problem of putting all one’s eggs in one basket. The Covid-19 pandemic has shown that global supply chains are as fragile as they are vital.

It seems that Apple is now reaching beyond China and into other countries such as India, who boast of having their own major tech manufacturing sector. Some analysts forecast that India’s manufacturing of iPhones will be on par with China’s by 2027, although a high estimate, it shows that China’s position as dominant tech manufacturer is shakier than it ever has been.

Essentially, Apple has been hit with a one-two-punch. When zero-covid lockdowns took place, production ground to a halt. Now that these restrictions have been eased in the country, they’re facing the consequences of quickly rising cases. Now, many analysts are speculating about whether the blindfold has been pulled off, and if these and other factors are something Apple is not immune to.

What does this mean for mobile gaming?

At the moment? Very little, however it does represent a stumbling block for a company that has an infamous ‘walled garden’ approach to its digital ecosystem. For many developers and studios, the idea that Apple could be overtaken by another company may not be a bad thing. Of course this would necessitate accounting for new factors when developing, however with many already expanding beyond Apple due to the aforementioned factors this wouldn’t represent a major or unexpected shift.

The future however, for China, may very well be another tipping point. Tech manufacturing, mobile and mobile gaming are inextricably linked. With Apple looking to diversify revenue and expanding manufacturing to other countries, this would see these countries receiving more investment and a boost to their economies, in theory at least. In the past year, many major stories have cropped up about how China’s mobile market is slipping behind where it once sat as the untouchable dominant, much like Apple.

And with new tech such as Apple’s recently leaked AR goggles promised for 2023 the scramble to find manufacturing capability (and deliver the goods that keep profits rolling in and share prices high) could be about to get even harder.

In conclusion

Apple’s circumstances may be more indicative of wider trends than anything restricted to the mobile world. However, if Apple is not sure whether they’ll remain on top they may be forced to reconcile more with the developers and studios that make apps for their ecosystem, including games. This may see both a more consumer and business-friendly approach, although we’re not likely to see anything like the reintroduction of previous user data accessibility anytime soon.

Staff Writer

Iwan is a Cardiff-based freelance writer, who joined the Pocket Gamer Biz site fresh-faced from University before moving to the Pocketgamer.com editorial team in November of 2023.