KATE THOMPSON DAVY: Apple of our eye: what 2024 may hold for the world’s richest company

I didn’t write a lot about Apple in 2023, despite its immense wealth and the hold it has on the consumer tech zeitgeist. That’s partly due to the fact that releasing “remarkable” new devices has become rather unremarkable for Apple by now. I can also blame Elon Musk’s shenanigans and Open AI drama for being vociferous headline hogs, sucking in much of the available attention. 

Not even its latest financial results, published in November (for its fiscal fourth quarter ending September), got a look-in in my column. Apple’s quarterly revenue at that point was just shy of $90bn, a 1% shave year on year. On the other hand, quarterly earnings per diluted share rose 13%.

Apple ended 2023 with a market cap of $3.08-trillion and achieved a record share price mid-December, just shy of $198. Business Insider wrote last month that it boasted a valuation larger than the GDP “of all but six of the world’s biggest economies” (compared to 2022 GDP data from the World Bank). 

Alas, the start of 2024 has been far more bracing for Tim Cook and his executives, even with the confirmation that their mixed reality headset, the Apple Vision Pro, will be up for preorder this month and officially on sale in early February. 

Apple calls it “the most ambitious product” it has ever created, but early reviewers in June 2023 were not entirely overwhelmed by the layering of augmented and virtual reality in it. The tech worked, reported BBC tech editor Zoe Kleinman, but the content it was previewed with was “pretty ordinary”. 

Speaking on the BBC’s Tech Life podcast last week, Kleinman added that she believes mundane is not just the verdict but Apple’s plan — that the device will slowly become as commonplace as our smartphones, maybe ultimately replacing them. To do so, she says, the heavyweight price (about $3,500) will have to slim down considerably. So too its profile and heft, to a place where it looks more like a pair of glasses (her words) and less like the bulky snorkelling mask it currently resembles (my opinion). 

Tech journos, market analysts and Apple’s particularly loyal fan(atic)s will be watching this sales launch closely — to see if the Vision category and its promise of “spatial computing” can find its niche, a necessary foothold on which to base its future climb. 

More competitors

We also expect more competitors, and soon. Already at CES 2024 in Las Vegas last week Sony unveiled its mixed reality headset. “Sony’s headset doesn’t look goggle-like: instead its flip-down design floats the display tech over the eyes, allowing for some peripheral vision on the sides,” explains CNET.

Sony’s PlayStation brand already has a VR 2 headset, but this new collab from Sony and Siemens (featuring a Qualcomm chip) is not gaming-focused, targeting spatial content creators and engineering types instead — which means squaring up to the Apple Vision Pro and a similar device we’re expecting from Samsung this year. 

Even with the expected competition, this launch will be a highlight of the quarter (perhaps the year) for a firm that, as I said, had a much wobblier start to 2024 than 2023’s successes might have indicated. 

Some of the “bad news bears” of late are legacy ones. Apple has finally started making payments to complainants in a US class action lawsuit it settled in 2020, splitting out about $500m (roughly $90 per recipient). Although Apple maintains it was not in the wrong for deliberately slowing down some older iPhones — for the sake of performance, it argued — it agreed to pay rather than continue to fight the case in court. In the UK, a similar case is playing out, this one with a potential £1.6bn price tag if things go against Apple.

Adding insult to injury, Apple stock landed with a bump on the first trading day of the year, sinking about 4% on a downgrade from Barclays that declared Apple “underweight” (down from “equal weight”), based on lower-than-expected sales of the iPhone 15, particularly in China. 

Apple saw a 30% decline in iPhone sales in China for the first week of the year, says Bloomberg, citing Jefferies analysts, which they say can be put down to “signs of growing competitive pressures” from regional powerhouses such as Huawei. This sales slump had a knock-on effect on overall Chinese smartphone shipments, says the brokerage in an advisory note published last Sunday. 

“This decrease in Apple’s sales took place despite aggressive discounting of multiple iPhone models through major Chinese online marketplaces, according to the research note… [and] represents an acceleration from the 3% year-over-year decline the US company saw for all of 2023 in its third-largest market,” writes Bloomberg. 

And that’s all on top of the considerable blow of temporarily withdrawing the latest Apple Watch models from the US market — a decision necessitated by the US International Trade Commission ruling that would see imports of the device banned due to patent violations. And you thought your New Year’s hangover hurt …

So the financial pressures are mounting (despite Apple’s absolutely monolithic market value), and the incremental shifts in specs of the latest generation iPhones have failed to wow consumers. That’s not to discount the power this iconic brand has, but collectively it means the Vision Pro has a lot of expectation to shoulder. 

• Thompson Davy, a freelance journalist, is an impactAFRICA fellow and WanaData member.