Last week, a day after Apple lost $57 billion in market value, resulting from the plunge the company’s stocks took after it slashed its revenue forecast, U.S. President Donald Trump told reporters at a White House press conference that he was not really worried about it.
No, I’m not,” he said when a reporter asked him if he was concerned about the tech giant’s stock debacle.
“I mean, look, they’ve gone up a lot,” Trump said, adding, “You know, they’ve gone up hundreds of percent since [I’ve become] president.”
He also said: “Apple was at a number that was incredible, and they’re going to be fine.”
However, he did express his dissatisfaction with the fact that Apple continues to manufacture its products in China when making them at home was a better option, he thought, for the Cupertino-based company.
The US president probably doesn’t realize that moving iPhone production out of China is easier said than done.
Here’s what Dan Ives, Wedbush Managing Director of equity research, told CNN Business.
“Man could be on Mars before Apple is producing more of its iPhones in the United States, just from a supply chain cost perspective.”
In a letter to Apple investors, company CEO Tim Cook cited a number of reasons for the company’s modest projection for the last quarter, including, but not limited to, below par iPhone sales, US-China trade war, and its own reduced-price iPhone battery replacement scheme.
Although emerging markets, including China, were largely responsible for the year-over-year decline in iPhone revenue, iPhone upgrades in developed markets were also “not as strong as we thought they would be,” Cook wrote.
He added: “While macroeconomic challenges in some markets were a key contributor to this trend, we believe there are other factors broadly impacting our iPhone performance, including consumers adapting to a world with fewer carrier subsidies, US dollar strength-related price increases, and some customers taking advantage of significantly reduced pricing for iPhone battery replacements.”
Back to Trump and his soft Apple-bashing, the US president said that the Apple’s stock would have no bearing on the US economy because the iPhone company makes its products in China, something that the company has refuted.
“Apple is a great company. Look, I have to worry about our country,” he said at the press conference, adding, “Don’t forget, Apple makes the product in China.”
He wasn’t done yet, as he went on to say, “I told Tim Cook, who’s a friend of mine who I like a lot, make your product in the United States.”
If you are wondering whether or not his friendship with Cook is on a reciprocal basis, you’re not alone.
He added: “Build those big beautiful plants that go on for miles. Build those plants in the United States. I’d like that even better. Apple makes its product in China. China is the biggest beneficiary of Apple … because they build their product mostly in China.”
He had more to say.
“But now, [Cook is] investing $350 billion — because of what we did with taxes and the incentives that we created — in the United States,” Trump said. “He’s going to build a campus and lots of other places.”
He said his focus was on the nation and that he wanted Apple to make its iPhones and all of its other products in the United States, asserting that it “will take place.”
However, the $350 billion investment Trump is talking about is mostly going towards tax repatriation and to Apple suppliers, with a likelihood of less than ten percent of the amount ending up in investments in the country, according to a Politifact report last year after Trump first bragged about it.
As far as building campuses in the country is concerned, Apple did announce in December that it was planning to spend $1 billion to build a brand new campus in Austin, Texas, that would eventually employ 15,000 workers.
It is part of the company’s three-year expansion drive to build new facilities in Seattle, San Diego, Culver City, Pittsburgh, New York and Boulder, Colorado, with a strong likelihood of more such facilities coming up in other US cities in the longer term.
“Apple is proud to bring new investment, jobs and opportunity to cities across the United States and to significantly deepen our quarter-century partnership with the city and people of Austin,” company CEO, Tim Cook said in a Dec 13 press release.
“Talent, creativity and tomorrow’s breakthrough ideas aren’t limited by region or zip code, and, with this new expansion, we’re redoubling our commitment to cultivating the high-tech sector and workforce nationwide,” said the Apple CEO.
Apple was apparently living up to its January 2018 promise of generating employment for at least 20,000 people across the nation by 2023, having already created 6,000 jobs in the U.S. last year.
The Steve Jobs-founded company is looking to invest a whopping $10 billion in data centers across the country over the next five years, with plans of spending nearly half of it by the end of 2019.
Work is already underway to expand the company’s existing data centers in North Carolina, Arizona, and Nevada, in addition to a new 400,000-square-foot, state-of-the-art data center being planned for Waukee, Iowa, to boost its iMessage, Siri, the App Store, and other services in the country.