Apple draws up a $10 billion data center investment plan

Apple (AAPL) plans to invest more than $10.0 billion to set up more data centers across the US (SPY) in the next five years. The company has already invested billions of dollars in data center projects in the US during the last decade. Apple is also setting up data centers in Europe (EFA) and China (MCHI).

How Apple’s Data Center Plans Could Affect Amazon and Google

Google trying to disrupt the cloud market

Although Apple has been building its own data centers, the company still relies on Amazon (AMZN), Microsoft (MSFT), and Alphabet’s (GOOGL) Google for its cloud computing needs. Amazon is the world’s top cloud vendor, followed by Microsoft.

Google, having tapped VMware (VMW) co-founder Diane Greene as head of its cloud business, has stepped up its campaigns for more cloud market share, turning itself into a disruptive force.

Apple could transform into a cloud competitor to Amazon

Apple’s (AAPL) ongoing data center investments could help the company reduce its spending on third-party cloud services, which could reduce its expenses. Apple’s total operating expenses (or opex), including the cost of revenues, totaled $167.9 billion in fiscal 2017.[1. fiscal 2017 ended September 2017]

For Amazon, Google, and Microsoft, Apple’s data center investments could not only lead to loss of business from a seemingly important cloud customer but could also lead to a customer transforming into a competitor.

To support these data center investments, Apple’s capital expenditure (capex) for 2018 is set to increase 7.5% over last year’s capex to roughly $16.0 billion.

Latest articles

This year, Pfizer (PFE) stock has fallen 0.34% and Bristol-Myers Squibb (BMY) stock has fallen 6.48%. Both companies are focused on strengthening their position in the high-growth oncology and immunology markets. Let's take a closer look at each.

Walt Disney’s (DIS) latest movie, Toy Story 4, has reportedly broken records in the opening weekend with $118 million in sales. However, the opening weekend collection was behind analysts’ expectations of at least $150 million in the first weekend.

24 Jun

Will Home Depot’s Upward Momentum to Continue?

WRITTEN BY Rajiv Nanjapla

As of June 21, Home Depot (HD) was trading at $209.39, which implies a rise of 9.7% since the announcement of its first-quarter earnings on May 21. Also, the company was trading at a premium of 32.4% from its 52-week low of $158.09 and a discount of 2.8% from its 52-week high of $215.43.

On June 21, Aurora Cannabis (ACB) made an announcement that indicated that it will move towards higher margin vape products. In addition, the company also believes concentrates and edibles will command higher margins. In anticipation of this development, the company announced the expansion of its facility to capitalize on growth related to these segments.

Shares of Mondelēz International (MDLZ) are scaling new heights thanks to its stellar gains so far this year. Mondelēz stock is up 38.0% on a YTD (year-to-date) basis, and it closed at $55.25—just a shade lower than its 52-week high of $55.71—on June 21.

24 Jun

How Long Will Facebook's Libra Fuel Bitcoin Rally?

WRITTEN BY Mayur Sontakke, CFA, FRM

Ever since the news about Facebook’s (FB) cryptocurrency project broke, Bitcoin has rallied on the hope that Facebook’s entry in the space will help make cryptocurrencies mainstream. Facebook’s cryptocurrency will be called Libra and will be governed by an association with 28 founding members across industries.