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Earlier this week, Apple Inc. CEO Tim Cook discussed his plans for the company's AR applications, which was followed by a strong investor response. Although APPL dropped about 3% during trading hours, it made a jump of up to 8% in the after-hours.
Apple Inc. Interested in Metaverse
According to the statistics, Apple Inc is home to 14,000 Augmented Reality Applications on its App Store which are designed utilizing the ARKit - an AR developing platform and Tim Cook believes that this number will only rise after further investments. On Thursday, in response to a question regarding his plans for metaverse, he commented:
"We see a lot of potential in this space and are investing accordingly. We're always exploring new and emerging technologies and I've spoken at length about how it's very interesting to us right now."
The Metaverse is referred to as a shared virtual world environment created for the customers, that aims to provide a means to socialize, a gaming platform, and even live shows. The Metaverse can only be accessed through an internet connection, with the help of Virtual Reality or Augmented Reality. Tim Cook's comment alone assisted Apple greatly by driving its stocks nearly 5% in after-hours trade. Based on numbers, Apple's services revenue leaped by 24% to $19.5 billion. 785 million subscribers were added to Apple Inc through the numerous paid services like streaming music and playing games.
Introduction to Augmented Reality by Apple
To immerse users in Metaverse, Meta has been promoting the use of the Oculus headset, while Apple is making its way to the world of AR technology. Ming-Chi Kuo, Apple's analyst announced their plans to introduce an AR headset, possibly by the coming year as Bloomberg reported the delay was caused due to challenges faced in the hardware and software program. Although Apple has not officially acknowledged the plan, however, Tim Cook's perseverance to grow subscriptions shows they are looking forward to it. On Thursday, Tim Cook put forward that their research and development efforts are mainly focused on hardware, software, and services. Cook knows that an Augmented Reality device is a treasure box filled with opportunities to attract subscribers. And the observed result shows that with the growing number of subscribers and services, the gross profit margin has also jumped above 40%. With the introduction of metaverse-related services, such as AR applications, Analyst Neil Shah of Counterpoint Research feels that this can help change Apple's revenue mix. He further says,
"There is a significant upside to Apple's services business potentially crossing its iPhone in the next five years."