This year hasn’t been kind to Apple. Shares are down nearly 20 per cent, making it the worst performer among the magnificent seven. Long the world’s most valuable firm, Apple now ranks third, well behind Microsoft and Nvidia.
The numbers explain why. Nvidia’s revenue has more than quadrupled in three years. Microsoft’s is up over a third. Apple’s, by contrast, has barely budged.
That might be excusable if Apple were brimming with promise, but its pipeline looks thin. The Vision Pro flopped. A long-awaited artificial intelligence-powered Siri is still missing. Apple Intelligence hasn’t driven iPhone upgrades. Former Apple design guru Jony Ive is developing a screenless AI device with OpenAI, a potential iPhone rival.
Meanwhile, judges are rebuking Apple in court. Lawmakers are circling its App Store. Regulators from Brussels to Beijing are prying into the company, and US president Donald Trump is making life awkward for CEO Tim Cook, threatening 25 per cent tariffs unless Apple shifts iPhone production to the United States.
Apple’s forward price-earnings (p/e) ratio has fallen to 28. Still, it remains above its three-, five- and 10-year averages – not stretched, but hardly cheap.
That suggests 2025’s downturn is no panic, but more an overdue recognition of cooling fundamentals. Value investors won’t be diving in just yet.
Notably, Warren Buffett’s Berkshire Hathaway, which sharply cut its Apple stake in 2024, has not shown any appetite to rebuild its position in recent months. (Disclosure: I own shares in Berkshire.)
Investors aren’t fleeing, but the spell has broken. Once the market’s metronome, Apple now feels a beat behind.
