Apple was accused of misleading investors in 2018 due to CEO Tim Cook's controversial statements regarding the Chinese market. As a result, the company has agreed to pay $490 million.
In November 2018, during a revenue announcement, Cook's optimistic remarks about iPhone sales in China raised investor expectations. However, a few months later, Apple revised its revenue forecast down by $9 billion. This led to a nearly 10% drop in the company's stock price. Consequently, investors sued Apple, claiming that the company had artificially kept its stock price high.
At the end of the legal process, Apple and the claiming investors reached a settlement of $490 million. This amount marks the largest collective securities fraud settlement Apple has faced in the U.S. The case highlights the growing demand for more attention and transparency in companies' financial forecasts and statements. In particular, Apple's avoidance of giving official revenue forecasts during the COVID-19 pandemic indicates a more cautious approach in this area.
As a result, this agreement underscores the importance of investors being more vigilant about companies' financial disclosures and the need for greater transparency.
