Warren Buffet Skeptical Over Apple’s New Entertainment Move

385

Apple made news earlier this week when it announced on Monday that it would begin competing with other streaming platforms as it offered a platform for users to subscribe to various channels as well as its own entertainment service and content.

Overall, the move would see the tech giant enter an already crowded field, fighting amongst other companies such as Netflix, Amazon, Disney, and Hulu. Today, Warren Buffet voiced his skepticism over this move from Apple, saying that there’s too much competition out there already and that while he admired the willingness to try something new since the company can “afford a mistake or two.”



“I’d love to see them succeed, but that’s a company that can afford a mistake or two,” Buffett said when asked about Apple’s recent entertainment push. “You don’t want to buy stock in the company that has to do everything right. Apple should do some things that don’t work. You’ve got some very big players who are going to fight over those eyeballs. You have very smart people with lots of resources trying to figure out how to grab another half-hour of your time. I would not want to play in that game myself.”

Currently, Apple is Berkshire Hathaway’s largest investment, owning around 5.5 percent of the tech giant. It was revealed last month that Buffet ended up cutting his stake in the tech giant during the end of 2018 down to 249.6 million shares. However, he still feels that the company is a good investment despite market reports that indicate slowing iPhone demand. Apple ended up lowering it’s revenue estimates due to a slowdown in Chinese iPhone sales, ending the year at $84.3 billion in revenue, with iPhone revenues dropping 15 percent down to $52 billion in comparison to 2017.

“Ten years from now, when we look at entertainment delivery, it will be what people want. It will be in the form they want,” Buffett added. “It’s going to be a very, very big, hotly contested game, and the one thing I can guarantee is that the public will be the winner.”

Shares of Apple didn’t move much in response to the news, as expected for a company with over a trillion dollars in market cap. Shares stayed roughly the same, inching up 0.13 percent. Buffet first bought shares of Apple back in 2016, buying around 57.4 million shares for around $1 billion.

Apple Company Profile

Apple designs a wide variety of consumer electronic devices, including smartphones (iPhone), tablets (iPad), PCs (Mac), smartwatches (Watch), and TV boxes (Apple TV), among others. The iPhone makes up the majority of Apple’s total revenue. In addition, Apple offers its customers a variety of services such as Apple Music, iCloud, AppleCare and Apple Pay, among others.

Apple’s products run internally developed software and semiconductors, and the firm is well known for its integration of hardware, software and services. Apple’s products are distributed online as well as through company-owned stores and third-party retailers. The company generates about 40% of its revenue from the Americas, with the remainder earned internationally. – Warrior Trading News

IMAGE CREDIT

NO COMMENTS

LEAVE A REPLY