Why Apple's Stock Remains Heavy Despite 'Record' Earnings: Memory Costs, Interest Rates, and AI Power
What is happening in the market right now is not just a 'collection' of individual company news.Monetary policy (next Fed Chair appointment) → Tech stock risk appetite → Supply chain (memory) → AI investment and power → Restructuring of giant corporations—the view is that these are all connected by a single thread. Below, using these statements as a guide, I will organize 'what the issues are, what investors are afraid of, and where they see hope.'
1. Macro determines the 'ceiling' for tech
Regarding Kevin Warsh, who was nominated as the next Fed Chair,the market braced itself, wondering, 'Is he more hawkish (prioritizing inflation control above all)?' The commentary suggests that 'the belief that inflation is the only job' is what leads to his hawkish reputation.
On the other hand, perspectives go beyond just rate hikes and cuts. A representative from Allspring, citing the side effects that past aggressive tightening had on banks (e.g., SVB), presented the view that 'a stability-oriented approach, including bank regulation, is more positive than financial management that is overly 'active' and amplifies the business cycle.'
What is important here is that tech stocks are being evaluated not just on interest rates themselves, but in conjunction with 'financial system stability.'
2. Apple remains anxious despite 'record earnings'
The reason Apple's stock price remains sluggish despite record quarterly revenue has focused on 'rising memory prices.' It was noted that CEO Tim Cook's comments about 'rising memory prices having a greater impact on gross margins' cooled investor sentiment.
2-1. If supply constraints continue, the winning strategy becomes 'price'
One analyst stated, 'Apple is a master of cost management,' and then quite frankly described the moves they would make in a situation where there are still limits.
'(If memory costs rise) we will either raise device prices or raise the prices of higher-capacity memory models to absorb it.' What is implied here is that Apple's strength lies not in a 'price-cutting war,' but in product hierarchy and pricing design.
2-2. iPhone demand is strong, but AI is not the 'reason for upgrading'
The fact that iPhone sales significantly exceeded market expectations, and the growth in China, became topics of discussion. However, calm views on generative AI are being repeated.
'People don't buy new devices 'because there is GenAI,' they buy them 'because they are in the Apple ecosystem.'' The immediate main battlefield is not the 'flashiness of AI features,' but how much demand can be captured under supply constraints and whether cost increases can be passed on to prices.
3. AI investment and power: Will data centers 'lower inflation'?
While Warsh speaks of AI as a 'disinflationary factor (productivity improvement),' opinions are divided regarding power costs. Investors frankly counter, '
If the costs of baseload power and grid reinforcement rise, electricity rates will be hard to lower.' In contrast, the CEO of PG&E presents the logic that if data center demand increases,
'more kWh will flow, allowing fixed costs to be shared and unit costs to decrease.' This is important as a future investment theme. Rather than simplifying 'AI = high power costs,' we cannot reach a conclusion without looking at
rate design (who bears the reinforcement costs)
consumer contract structures (whether it will spill over to regional markets)
the recovery period for grid investments.
4. Reshoring and manufacturing: The trend indicated by VulcanForms' fundraising
The topic of VulcanForms (3D metal printing) is directly connected to macro trends. The explanation of 'shortening the distance metal atoms travel to become a product' and 'making only what is needed' is the very idea of simultaneously reducing costs and geopolitical risk.
The point about political color being involved for investors was also touched upon, but the CEO's words were practical.
'We will partner with anyone who wants to move American manufacturing forward, whether it's the government or PE/VC firms.'
The point is that technology that redesigns the supply chain itself is attracting capital more than 'subsidies' are.
5. Privacy Issues: How Much Can WhatsApp's 'Encryption' Be Trusted?
Finally, the allegations surrounding Meta's WhatsApp. A former contractor (employed by Accenture) claims they 'could access encrypted messages,' leading to investigations by law enforcement and complaints to the SEC. Meta claims this is 'impossible,' and WhatsApp emphasizes its end-to-end encryption using the Signal protocol.
What investors should look at here, in addition to the truth of the matter itself, is that we are entering a phase where the 'cost of privacy accountability' is increasing. Regulation, litigation, and loss of trust are volatility factors, especially for companies with advertising models.
The overall takeaway is not the optimism that 'AI will save everything,' nor the pessimism that 'supply constraints will destroy everything.' When interest rates, regulations, power, semiconductors, manufacturing reshoring, and privacy are all moving at once, the winners will be companies that possess not only 'technological superiority' but also *pricing design, procurement power, and explainability (in a form investors can understand)*.
