Although Apple, Inc. (AAPL) is not known for its numerous M&A transactions, it has made a considerable amount of acquisitions that have helped improve its products and services. According to sources, Apple is said to have made 129 acquisitions to date, with the most recent one being WaveOne, an AI-driven video compression startup. Making major headlines was the announcement to purchase Beats Electronics on May 28, 2014, at a staggering price of $3 billion, which has remained the company’s biggest acquisition to date.
The deal involved the subscription streaming music service Beats Music and Beats Electronics, which made Beats headphones, speakers, and audio software. The purchase was believed to give Apple access to a range of high-end accessories and a streaming service that rivals Spotify Technology S.A. (SPOT), making it a margin-boosting strategy. Beats Music gave Apple an advantage as it launched its Apple Music streaming service, which JPMorgan estimated in 2022 would likely have 110 million subscribers by 2025, according to Forbes. Spotify had 210 million paid subscriptions at the end of Q1.
If an investor had invested $1,000 in Apple on the day the Beats deal was announced, they would have received 50.5 shares, and with two stock splits, a 7-for-1 split on June 9, 2014, and a 4-for-1 split on Aug. 28, 2020. The investor’s holding would have increased to 1,414 shares. Taking into account the stock’s closing price of $175.43, the investor’s holding would be worth $248,058.02, which represents a 24,705% gain. The gains would have been much more significant if Apple’s periodic dividends and returns from potential dividend reinvestment were accounted for.
As of Friday’s session close, Apple closed at $175.43, up 1.41%, according to Benzinga Pro data.