Apple’s CEO Tim Cook has continued to make the argument that the Cupertino, California iPhone maker is a consumer company, not a tech one, pointing to Warren Buffett’s investment as evidence.
In an interview with CNBC, Cook said famed investor Buffett understands that Apple is a consumer products company and that technology enables it. “[Buffett] has been very clear, he didn’t invest in technology companies and companies he didn’t understand. He’s been totally clear with that. And so he obviously views Apple as a consumer company,” Cook said.
The executive did acknowledge that Apple is playing in the tech industry, but that the company makes products for people with a focus on the consumer. Cook, who attended the Berkshire shareholder meeting for the first time, said Buffett’s investment is “recognition” that Apple is evolving. “We run the company for the long term. And so the fact that we’ve got the ultimate long-term investor in the stock is incredible,” he stated.
Berkshire Hathaway has famously shied away from investing in tech stocks, with Buffett saying he doesn’t really understand the industry well enough to invest.
In 2011, he did invest $10 billion in IBM, but sold most of the stock by 2018. In 2016, Berkshire purchased shares of Apple for the first time, and since then has built a $50 billion position in the company. Last week, Bloomberg reported Berkshire Hathaway has been purchasing shares of Amazon, with Buffett saying he had underestimated Jeff Bezos, founder and CEO of Amazon.
While Apple still relies on the iPhone for the lion’s share of its revenue, the company has been expanding its services as it searches for growth outside the mobile phone. That area of its business is booming, but is not without challenges. For example, the Financial Times reported earlier on Monday (May 6) that the European Union will launch an antitrust investigation into Apple Music, spurred by a complaint from rival Spotify.