By Anna Peel. Originally published at ValueWalk.
- First iPhone released to the public on 29 June 2007.
- Apple Inc (NASDAQ:AAPL)’s share price at launch was $1.39. Today it’s $141 – valuing firm at $2.29 trillion.
- 1.39 million original iPhone units sold in 2007. That rose to 240 million last year.
- There are 2.22 million available apps for iOS and smart phone adoption has sparked a revolution in share trading on apps.
- Just 0.6% of clients were using the HL app back in 2014 compared to 44% in 2021.
The iPhone Sparked A Revolution
“The release of the iPhone sparked a revolution in our everyday lives, with smart phones becoming the home computer in the pocket – indispensable to millions of people around the world. Apple may have been overtaken by Samsung Electronics Co Ltd (KRX:005930) in terms of smartphone shipments globally, but it’s bitten the biggest chunk out of premium market. Fresh incarnations of the iconic handset have kept fans loyal around the world, entranced by its new features like the bionic superfast chip, improved camera and animated wallpapers.
Q1 2022 hedge fund letters, conferences and more
Despite enormous macroeconomic pressure, the iPhone has helped Apple deliver another round of record growth at the last count. This is testament to Apple’s biggest asset -its brand – which means its product launches are legendary among tech fans. The iPhone’s popularity has endured, with the iconic handsets still making up over half of net sales, even though the market is crowded with many smart phone rivals. Apple’s brand power is also helping the company stay strong despite the harsh winds of inflation. However, it hasn’t been immune to painful supply chain challenges, partly because of incredibly short production cycle.
This is why the bigger push into services has the potential to offer even more resilience going forward. The access to the vast app store creating a window to a world of new innovation is a huge coup pulled off by Apple. Although arguably Nokia could boast about one of the first ever apps, with its rudimentary snake game on the interface, it was left behind by the power of Apple.
The app store has become an engine of growth for ingenious software applications around the world, and still creams off a lucrative 30% revenue for developers earning more than $1 million through the app store on an annual basis. With Google Play now also a major competitor, the app store market globally was estimated to be worth $138 billion in 2021 and is expected to reach $750 billion by 2030, according to Precedence Research.
A Surge Of Interest In Investment Apps
As consumers turn to apps for health and education, banking, gaming and relaxation, the smart phone has become an essential tool for almost every facet of our lives. There has been a surge of interest in investment apps during the pandemic, as locked down consumers turned to trading as a new past-time, to invest savings being built up and to try and benefit from stock market volatility.
Just 0.6% of HL clients were using the HL app back in 2014 steadily climbing to 26% in 2018. But in 2020 the number of clients trading via the app jumped to 38%, rising again to 44% in 2021. By contrast trades via the website have dropped off sharply, from 95% in 2014 to 54.8% in 2019. Telephone trades are now very few and far between, dropping from 5% in 2012 to 0.5% in 2021, demonstrating the extent to which digital trades dominate.
In many ways trading apps have democratised the whole investment process but they still need to be used thoughtfully. Just because you can make a super-fast transaction, it doesn’t always mean you should. If you are trading on the go, you need to ensure you give each trade as much consideration as you would if you were sitting in a quiet place at home, to try and ensure you are not swept up in any hype. Given that other apps on the phone interface open up to social media platforms and often a swirl of speculation, it’s really important that investors think twice before putting money into products as part of a gaming mentality, and should instead pursue a well thought out long-term investment strategy.”
Article by Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown
About Hargreaves Lansdown
Over 1.7 million clients trust us with £132.3 billion (as at 30 April 2022), making us the UK’s number one platform for private investors. More than 98% of client activity is done through our digital channels and over 600,000 access our mobile app each month.
Updated on
Sign up for ValueWalk’s free newsletter here.
