A report from Bloomberg’s Mark Gurman reveals that Apple has significantly reduced its pace of acquiring new companies.
In February 2021, Tim Cook noted that Apple had acquired up to 100 companies in the last six years. That means the tech giant snapped up startups every three to four weeks — laying the foundation for features such as Siri, multi-touch, and FaceID.
The company spent a whopping $1.5 billion on corporate acquisitions in fiscal 2020 alone. But that’s no longer the case.
According to a Bloomberg report, Apple has slowed the pace of acquiring new companies over the past two years. Indeed, regulatory filings show that the company spent $200 million on acquisition-related payments over 2021 and 2022.
So far, Apple’s known corporate acquisitions in 2022 are UK-based startups AI Music and Credit Kudos. Similarly, Primephonic — a classical music streaming — was the company’s only acquisition in 2021.
In contrast, other tech companies have made massive acquisitions within the last two years. For example, Microsoft acquired Activision Blizzard Inc. for $69 billion, and Google purchased Mendicant Inc. for $54 billion.
So what’s responsible for Apple’s slow down?
Why Apple Has Slowed Pace of Startup Acquisitions?
According to Gurman, increased regulatory scrutiny may explain Apple’s reduced startup acquisitions. For example, the company’s app tracking transparency framework faced antitrust investigation in Germany in June.
“Like some other companies, Apple added language to its annual report last year noting that acquisitions face more risks now,” says Gurman.
Besides, Apple is reportedly looking to cut back on spending next year, further slowing down the startup acquisition pace.
Analysts asked Cook about the reduced acquisition spending during the company’s last two earnings calls. However, the CEO maintains that the company is always looking for startups that can help its strategy.
“I don’t want to go through my list with you on the phone, but we’re always looking,” he said.
Be that as it may, reports suggest that the company is also reducing spending in other areas. These include shrinking expenditures and slowing hiring.