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Goldman Sachs: Apple’s new service has little contribution to profit, and its share price has fallen more than 20%.

Sina Technology reported that Apple’s spring release will include services such as Apple New+, Apple Card, Apple TV+, and Apple Arcade. These “soft” products will open a new window for Apple, but at the same time, it faces more market challenges. According to the US financial website CNBC, a major partner of Apple’s Apple Card product, Goldman Sachs, released a report on the 26th that investors will turn their attention to iPhone growth because Apple’s new services have little effect on profits. Weakness will further lead to a significant correction of Apple’s share price by more than 20%.

Goldman Sachs analyst Rod Hall released a report on the 26th to maintain Apple’s “neutral” rating and set Apple’s target price to $140 in the next 12 months, compared to Apple’s 26-day closing price of 186.79. The dollar is low, falling more than 20%.

Hall believes that these new services from Apple will not contribute much to the company’s profit growth in the short term. Although these services are interesting from a platform perspective, it is estimated that no service can be used in the short term. The revenue has a substantial impact; among them, Apple Card is expected to generate $882 million in annual revenue, with little impact on Apple’s short-term earnings. Also, due to the small impact of these services, it is expected that after the press conference, the market attention will be redirected to the iPhone business slowdown.

Howe also estimates that Apple’s service business will continue to be dominated by Apple Store retail stores, which accounted for 51% of Apple’s service revenue last year, accounting for 70% of profits.

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Nandini Singh
From a very young age I was interested in computers and technology in general, I had my first computer at the age of 10 and at 15 I set up my first tower, since then I have never stopped. Whatever technology, I'm in the front row to know more.