- First-quarter PC sales fell globally after two years of pandemic growth, but Apple (AAPL) met the trend with growth.
- Apple's long-term plan to shift Macs and MacBooks to its own processors is paying off.
- This is another sign that investors should consider buying AAPL stock while it's still at the top of 2022.
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One of the unexpected effects of the Covid-19 pandemic was the reversal of nearly a decade-long decline in global PC sales. Computer sales have soared as many people working from home and schools are increasingly switching to hybrid or distance learning. Even in 2021, PC sales were up 14.8% year-on-year. Apple (NASDAQ:AAPL) reported record Mac sales of $9.18 billion in the fourth quarter, showing that Mac sales are still a big part of the AAPL share value equation.
However, growth in the PC market abruptly came to a halt in the first quarter of 2022. In fact, a new report Gartner (NYSE:HE IS), showing that globally PC sales are down 7.3% compared to the first quarter of 2021. The top two PC manufacturers saw double-digit declines in their sales. A notable exception to the contraction was Apple, which saw Mac sales increase 8.6% quarter-on-quarter (year-on-year). This strength of Mac sales is another reason to consider investing in AAPL stock. Especially with those that are expected to go down Apple's pipeline in June.
Apple's Investment in Processors Is Clearly Paying
In 2020, Apple began the process of migrating all Macs to the company's own custom-design silicon. Back in November of that year, I wrote about the potential of these chips (the first was the M1) to provide a significant boost to AAPL stock.
Despite the broad tech stock decline in 2022, Apple shares are still up 44% since this article was published. There are many factors in growth—like the success of the iPhone 13, increased revenue for services, and AirPods dominance—but the resurgence of the Mac has been part of it. That story continued with the incredibly powerful new M1 Ultra processor and the Mac Studio, which was unveiled at an Apple event in March.
Apple reported $10.85 billion in Mac revenue in its last quarter. This increased 25% over the previous year. It represents 8.8% of the company's total revenue for the quarter. It's not an iPhone, but don't underestimate the Mac's ability to bolster AAPL stock, as the Mac is in the limelight and sales continue to soar even as demand for PCs dwindles.
WWDC May See a Crucial New Mac Release
Why is now a good time to buy Apple Stock? To take advantage of a new MacBook Air.
Apple first released the MacBook Air in 2008. It was the company's best-selling laptop until 2010. The MacBook Air has remained the must-have Mac laptop ever since. It wasn't easy for Apple to choose the MacBook Air as one of the first models to receive the new M1 processor. In the M1 MacBook Air reviews, the biggest blow most reviewers can muster was that it looked identical to the older model.
This will change. The rumor mill has been buzzing about a completely redesigned MacBook Air for months. The new model is expected to come with a new M2 processor with additional ports and a colorful design inspired by the 24-inch M1 iMac. According to an Apple analyst, we may see the new MacBook Air at Apple's Worldwide Developer Conference (WWDC). This takes place in June.
The market will react when the company packs an entirely new version of its best-selling laptop. Remember, this is Apple's mass-market Mac. This means that on June 6, AAPL stock could feel the impact of the M2 MacBook Air.
Conclusion: Should I Buy AAPL Stock Now?
Apple stock is a proven performer with a solid "B" rating. Portfolio Grader.
However, investing in this company is not without risk. It has been subject to ongoing regulatory scrutiny for anti-competitive behavior in areas such as App Store fees. In the most recent development on this front, Apple is currently under investigation by the EU in the music streaming space. Any economic contraction could also reduce consumer spending and Apple revenues. The company is taking steps to reduce its reliance on China, but this Chinese link remains a problem for supply chain disruption and the potential for economic sanctions.
Still, AAPL stock has what it takes to drive long-term growth. An all-new version of the best-selling Mac is very likely to arrive at WWDC in June. If that happens, it will likely be an instant AAPL stock catalyst. If you're considering adding Apple stock to your portfolio, AAPL is down 7% in 2022, now is the time to act.
At the time of publication, neither Louis Navellier nor the InvestorPlace Research Team member primarily responsible for this article (directly or indirectly) held any positions in the securities mentioned in this article.
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