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Apple supplier TSMC has started mass production on the processors for this year’s lineup of new iPhones, according to Bloomberg. The chip, which is expected to be called the A12, could be the first to use a 7-nanometer process in a commercial device, something the technology industry has been working toward for years.

This 7nm technology refers to the density of transistors on a chip, though the precise specifications can differ between manufacturers. Using a smaller process allows for chips to be smaller, faster, and more efficient, and over time, it can lead to cost savings. Current leading processors on smartphones, like Apple’s A11 Bionic and Qualcomm’s Snapdragon 845, are made with a 10nm process.

Samsung announced today that it’ll be ready to start producing 7nm chips at scale next year. The company has manufactured iPhone chips in the past and shared production with TSMC on the A9 chip in the iPhone 6S, but TSMC has been Apple’s exclusive SoC partner ever since.

Apple is widely expected to launch three new iPhone models this fall: an update to the iPhone X, a Plus-sized variant, and a lower-priced device with a 6.1-inch LCD.

The company has released a new privacy tool ahead of the impending GDPR European legislation that goes into effect on Friday. The new tool is available here and allows users to request a copy of all the data Apple holds on them, correct any data mistakes, deactivate their account, or delete their account entirely. Data users are able to download include purchase and app usage history, calendars, reminders, photos, Apple Music and Game Center statistics, documents stored in iCloud, marketing history, and AppleCare support history, reports MacRumors.

Right now the new data download tool is only available to Apple accounts that have been registered in the European Union, Iceland, Liechtenstein, Norway, and Switzerland, but Apple says it will be rolling out the tool to all Apple accounts globally “in the coming months.”

You probably already know that getting paid to own a stock (i.e. receiving a dividend) is pretty great. You know what’s even better? Having that payment grow over time.

Here’s where a popular method of investing commonly known as dividend growth investing comes in. In a nutshell, a dividend growth investor looks to invest in stocks that pay significant dividends and can both sustain those dividends and grow them for the foreseeable future.

One stock that every dividend growth investor should consider for his or her portfolio is Apple (NASDAQ:AAPL), as it ticks all the right boxes.

A silver iPhone 8 Plus on the left and rose gold iPhone 8 on the right.
IMAGE SOURCE: APPLE.

Apple’s dividend is large and sustainable
As of this writing, the company behind the iPhone pays a dividend of $0.73 per share each quarter, or $2.92 annually, which works out to a yield of around 1.56%. This isn’t the highest you’ll find among potential dividend growth stock candidates, nor is it even close to the highest-yielding tech stock out there, but it’s a respectable payout roughly in line with the S&P 500.

Perhaps more importantly, though, Apple’s dividend is sustainable. Generally speaking, dividend payments come out of a company’s free cash flow. So, to try to understand how sustainable a dividend is, we need to look at how much cash the company generates and compare that to the amount it pays out in dividends.

The percentage off free cash flow used to cover the company’s dividend expense is known as the cash dividend payout ratio. The smaller the percentage, the more sustainable the dividend is (since it’s more likely to be maintained even during a significant business downturn).

AAPL Free Cash Flow Per Share (TTM) Chart

AAPL FREE CASH FLOW PER SHARE (TTM). DATA BY YCHARTS.

Apple’s current dividend payout ($2.92) represents just 28% of the company’s overall free cash flow per share ($10.41). Income investors should take comfort that Apple could cover its dividend expense several times over out of the cash it generates.

Dividend growth capacity
Since Apple pays out just 28% of its free cash flow per share in the form of a dividend, it could increase its payout — and do so quite substantially — by simply choosing to allocate more of its free cash flow to the dividend.

While I think this is a possibility, Apple seems to prioritize share repurchases because management thinks the stock is undervalued.

The good news, though, is that Apple’s free cash flow per share has been trending up over the last 10 years (with some lumpiness here and there). So, if you believe that the company has significant growth potential left, then you’d have reason to believe that the company’s overall free cash flow will go up as well. Even if Apple chooses to hold their cash dividend payout ratio constant, increasing cash flow would lead to further dividend increases.

Another thing to consider is that Apple has been aggressively repurchasing stock and even announced that its board of directors had authorized yet another share repurchase program good for $100 billion worth of the stock. Share repurchases have the nice effect of increasing free cash flow per share because the share count comes down. Higher free cash flow per share should ultimately translate into a fatter dividend for stockholders.

AAPL Average Diluted Shares Outstanding (Annual) Chart

AAPL AVERAGE DILUTED SHARES OUTSTANDING (ANNUAL). DATA BY YCHARTS

So, with the combination of potentially increasing free cash flow, a shrinking share count, and room for Apple to funnel more of its free cash flow per share to the dividend, dividend growth investors should find plenty to like here.

Apple’s search for a major new campus has been going on for some time, with a wide range of potentially suitable locations to choose from.

It’s been reported that Apple may have shortlisted two locations, in Northern Virginia and North Carolina, with the latter said to be the favorite, thanks to generous tax incentives. Apple has chosen a very different approach to Amazon’s search for its new campus, and WSJ piece today suggests there are pros & cons to each …

Amazon’s approach was somewhere between a beauty contest and a reality TV show. It told states what it was looking for from candidate cities, then sat back and waited for pitches.

Cities put together slide decks outlining the steps they were prepared to take to effectively win Amazon’s business, the whole thing becoming a very public contest – some might say circus.

Apple, in contrast, has adopted a very private approach. It too has been holding meetings with officials from candidate cities, but in private.

CEO Tim Cook said that Apple disliked Amazon’s process.

An Amazon-like competition creates “a case where you have one winner and a bunch of losers,” he said, while Apple’s process is designed to avoid “putting people through a ton of work to select one” city. “The best things we can do in business is find the win-win,” the Apple CEO said.

And commentators say that there are other benefits to Apple’s more stealthy strategy.

Jay Biggins, executive managing director at corporate location firm Biggins Lacy Shapiro & Co, [outlined these]. By limiting publicity, companies can exert more control over the process, avoid being overrun with outreach from cities and focus negotiations to get more of what they want, he says.

But Amazon’s public search does have advantages too.

Amazon’s approach also allows it to collect data and cultivate relationships that it can use for future projects such as fulfillment or data centers, said Didi Caldwell, founding principal of Global Location Strategies, a Greenville, S.C., firm.

And because the company has been very transparent about every aspect of the search, the decision can be seen to be a fair one. Deals done in private may be viewed with more suspicion.

But at heart, both companies have the same aim: to secure the best deals they can. Apple, for example, got Texas to commit to investing $21M over ten years in return for Apple doubling the size of its operations in Austin. North Carolina has now passed tax incentives applying to companies investing at least a billion dollars and creating at least 3000 jobs – which just happen to be tests Apple’s new campus would pass.

I write about technology’s biggest companies
Opinions expressed by Forbes Contributors are their own.
This year Apple AAPL -0.18% will change its iPhone line-up dramatically. There will be three new models in three new sizes and – perhaps most surprisingly – some major price cuts. And now even Apple is giving us clues about this…

The eagle-eyed 9to5Mac spotted Apple has suddenly slashed the price of its USB-C to Lighting Cable by almost 25%. In real terms, this is a drop from $25 to $19 and in strategic terms, it gives away a lot.

Apple
Apple is prepared to mass produce fast USB-C chargers for all new iPhones

Leaks have repeatedly told us that there are two ways Apple will cut the cost of iPhones for new users by over $200 (including tax). Firstly, with a $100 price cut, and secondly saving users $75 by including fast charging in the box. Yes, Apple has been charging $49 for an overpowered 29W charger (iPhones fast charge at a maximum of 18W) and $25 for a 1m USB-C to Lightning cable (the bundled slow charger is USB-A to Lightning).

And here’s where it gets interesting.

What price does Apple charge users for the bundled USB-A to Lightning cable if they want to buy it separately? Yes, $19. So Apple is aligning the price for fast charging cables with what it asks for the slow charging cables which currently ship with iPhones and iPads.

Furthermore, if you look closely, this isn’t technically a price reduction. Apple is actually shipping an all-new USB-C to Lightning cable as the part number has changed from MK0X2AM to MQGJ2AM.

It doesn’t take a genius to work out this will be the same cable Apple ships with its new iPhones, and the price cut was facilitated by the massive new economy of scale generated from Apple ordering millions to go with every next-generation iPhone and iPad. Where is that economy of scale missing? The 2m version, which remains priced at $35.

Weibo
Leaked diagram of Apple’s bundled fast charger coming with new iPhones

But why would Apple make these moves so early and so publicly?

Because right now Apple is in a compatibility mess which it had to start solving the moment the ink was dry on the mass order of fast charging cables. As it stands, new MacBooks can’t charge and sync with iPhones and iPads out the box. MacBooks have moved exclusively to USB-C while iPhones and iPads ship with USB-A cables.

Apple is very conscious of this and, for a limited time, dropped the prices of all its USB-C accessories just to calm angry customers who dubbed this #donglegate.

But now the real solution is fast approaching and not only does it solve ‘donglegate’, but it gives iPhone and iPad fans what every rival smartphone and tablet maker has been providing for years: fast charging out the box.

Combine this with the additional planned price cuts, and the introduction of two crowd pleasers in the shape of a massive iPhone X Plus and ‘iPhone X mini’ and Apple could well have the sales ‘super cycle’ which never materialised with the original iPhone X. What’s more, given the expense these moves will cost Apple, it would be deserved…

One of the best reasons to buy a piece of Apple hardware, in my opinion, is the company’s history of protecting the privacy of its customers.

Provided you’re not a customer living in China.

You may recall that, a while back, iOS users in China lost the ability to download most VPN clients to their phones and tablets from the iTunes App Store—the Chinese government doesn’t like their citizens to be able to anonymously access the Internet or view the world through the lens of unapproved news sources. So, Virtual Private Networks were kicked to the curb. According to 9to5mac, Apple is once again showing the Chinese government their soft underbelly, in the name of being able to continue to sell their hardware in the country.

According to 9to5mac, the Chinese Ministry of Industry and Information Technology has decided that they’d like Callkit—a developer framework that lets devs bake VoIP capabilities into their apps for iOS—to not be a thing for applications available to its citizens. You likely use Callkit-backed apps on a regular basis, without even knowing it. When your iPhone displays you the name or number of who’s calling you on Skype? That’s Callkit, doing it’s thing. The Chinese government doesn’t dig on Callkit because of the fact that it’s difficult, if not impossible to intercept and monitor calls made using it. Last summer, Skype was removed from the Apple’s Chinese App Store portal, likely for this very reason.

Look. Before anyone swoops in to say that I’m anti-Apple I wrote this post on a MacBook. There’s an iPad Pro sitting on my desk and I have an iPhone 7 Plus that goes pretty much everywhere that I do. If that’s not enough for you, when I’m not blogging here, I write for Macworld. I like the gear that the Apple makes. But I hate what’s going on here.

In the United States, Apple has, publicly, flat-out refused to decrypt an iPhone for the FBI. The Guardian quoted Tim Cook as saying that “…at stake is the data security of hundreds of millions of law-abiding people and setting a dangerous precedent that threatens everyone’s civil liberties.” Apparently, Apple’s protection of civil liberties only extends to people who live in countries where the ability to sell their hardware isn’t at risk. The company has, over the past few years, become one of the biggest financial noises in the world

You don’t get to be the richest pooch in the dog pile by standing on principle.

The question I’m asking myself after hearing about Apple’s latest capitulation to China is whether the threat of being unable to sell their wares in the North American market would be enough to force them to lick the boots of our own governments. Given the leanings towards protectionism, xenophobia and paranoia that are quickly becoming the norm, not just in America, but around the world, we may not have to wait very long to find out.

As the sole gateway to putting software onto iOS devices, Apple’s App Store created $38.5 billion in revenue in 2017–and just shy of $10 billion in profits for Apple. Now, many of the software designers and developers behind much of that success are pushing back against Apple.

A group of Apple developers called The Developers Union has just released an open letter to the company, taking issue with historically non-negotiable policies, like whether users are allowed to preview apps and how big of a cut Apple gets from apps’ revenue. “We believe that people who create great software should be able to make a living doing it,” the letter states. “So we created The Developers Union to advocate for sustainability in the App Store.”

Of the 474 apps currently aligned for the cause, you’ll probably recognize zero. Apps like Spotify, Lyft, Instagram, and Clash of Clans are nowhere to be seen. The founders are writers and developers who’ve achieved some success, but are far from the sorts of Silicon Valley billionaires you’d expect could pick a serious fight with Cupertino. The unofficial spokesperson of the group, Brent Simmons, has designed and developed several apps across platforms, though perhaps most famously, NetNewsWire, a major RSS reader of the mid-aughts.

This lack of big names seems to be part of the point. The average mom-and-pop developer finds App Store success to be a total crapshoot and has zero influence over Apple’s policies. A 2012 study found that 59% of apps don’t even break even. By banding together, The Developers Union would like to see Apple institute new policies. The first would be the option for any app to be downloadable as a free preview–a way to allow consumers to try before they buy. Apple allows free trials, but only on subscription apps. So an expensive app without a subscription faces a significant barrier, since consumers will be wary of putting down money and taking the plunge.

“We can’t run the what-if. What if the App Store had had trial versions all along? How would things be different? We can’t know,” says Simmons. “We believe it’s self-evident that people are reluctant to pay for apps in part because it’s a gamble . . . ”

Next on the docket will be revenue sharing. Just like Google, Apple takes 30% of sales on the average app and all related in-app purchases, and 15% on longer-term subscription apps (which are the services that generate big bucks for Apple). They want to be “advocating for a more reasonable revenue cut,” but they haven’t shared what that cut would look like.

The question remains, however, why target Apple when Google, too, has very similar app policies, and many developers build apps to be sold on both marketplaces. “It’s because we’re Apple fans!” says Simmons. “Android developers are certainly free to do the same thing we’re doing.”

In any case, if software is the new hardware, then Apple needs to cater to its designers and developers. The problem is, what leverage do these workers really have, even en masse? Will they attempt to generate bad PR for Apple, through stories like this one? Will they pull their apps from the store, only to be replaced by competitors?

“Though we wouldn’t rule out some kind of protest, we’re a long way from even thinking about that kind of thing,” says Simmons. “Instead, we believe that Apple might listen to a group of developers asking for something that would help them. Our hope is that it has more impact than Apple’s private conversations with developers. We can say: ‘Here’s a thing we’d like to see happen. All these developers are on board.’” We reached out to Apple for comment but didn’t hear back by press time.

So long as Apple controls the funnel onto its iPhones and iPads, it’s hard to imagine even thousands of small developers changing the company’s mind. Then again, so long as Apple controls that funnel, Apple will be the sole target of their cause.

Developers of iOS apps distributed in China have started to receive notifications from Apple that they are required to remove CallKit, a software UI framework for integrating VoIP calling services, from their apps.

A post in an Apple developer forum last week recounts having an app rejected by Apple’s app review process because of the app’s utilization of CallKit.

“Recently, the Chinese Ministry of Industry and Information Technology (MIIT) requested that CallKit functionality be deactivated in all apps available on the China App Store,” the message explains.

Though Apple’s note rather charitibly refers to this as a request, it is in fact a requirement for inclusion in the China iOS App Store, as the next sentence explains.

china
Apple hands Chinese iCloud to Guizhou-Cloud Big Data Industry
READ MORE
“This app cannot be approved with CallKit functionality active in China,” it says. “Please make the appropriate changes and resubmit this app for review.”

The note goes on to insist that VoIP calling continues to be allowed in China, “but can no longer take advantage of CallKit’s intuitive look and feel.”

Introduced in iOS 10, CallKit provides a way to integrate calling services with other call-enabled apps. It doesn’t offer VoIP service; rather it provides the call-oriented interface elements.

Banning the CallKit framework doesn’t prevent VoIP integration in apps but it does make it more difficult and limited. Several other developers posting to the thread said they’d received similar notes.

The Register asked Apple to respond. We’ve not heard back.

According to Human Rights Watch, “The Chinese government, which already oversees one of the strictest online censorship regimes in the world, limited the provision of censorship circumvention tools and strengthened ideological control over education and mass media in 2017.”

Apple last year removed Microsoft’s Skype app and some other VoIP apps from its iOS App Store in China in response to demands from Chinese authorities. It also removed 674 VPN apps, which are not categorically banned but must have government approval to operate.

For apps and web services not subject to vendor-based censorship, Chinese authorities may implement a network-level blockade, as they’ve done with the likes of Facebook, Google, Gmail, Instagram, Snapchat, and Twitter.

Apple’s cooperation with Chinese censorship hasn’t gone over well with some US government leaders who have scolded the company for ignoring its moral obligation to promote free expression.

Coincidentally, Apple CEO Tim Cook recently criticized Facebook’s data privacy practices and characterized privacy as a human right.*

GE, Apple and Exxon all have this one thing in common GE, Apple and Exxon all have this one thing in common
5:45 PM ET Fri, 18 May 2018 | 05:10
Dow stocks Apple, Exxon Mobil, Chevron and General Electric are trading well above their 50-day moving averages. They have something else in common — one technician sees more upside for each.

“There’s a misperception out there that because a stock is overbought that that is bad,” Craig Johnson, chief market technician at Piper Jaffray, told CNBC’s “Trading Nation” on Friday.

Apple, the world’s largest company by market cap, is trading nearly 8 percent above its 50-day moving average, but Johnson says it’s set to continue its move higher.

“Apple’s already gone through a corrective move,” he said. It “doesn’t look like a stock that I want to be taking profits in. I think there’s probably more upside to go in that name.”

Apple shares traded in the red in March and April before exploding higher on positive earnings in May. Its shares are now more than 11 percent higher for the year.

Like Johnson, Michael Binger of Gradient Investments sees more room to run for Exxon Mobil and Chevron.

“There’s nothing like $70-$80 oil to really help these names like Exxon and Chevron,” Gradient’s senior portfolio manager said on Friday’s “Trading Nation.” “There’s no way we’re selling them right now. Their cash flow profiles are getting better.”

One stock on which Johnson and Binger disagree is General Electric. Where Johnson forecasts a “short-term bottom,” Binger sees a fundamental picture that points to further hardship.

“We’d prefer to stay on the sidelines of General Electric,” said Binger. “This recent move is more of a dead-cat bounce. I have no idea what their business model is going to look like going forward. I have a lot of doubt about their earnings power.”

GE is on track to close May with its second month of gains, though it remains lower for the year. Shares of the oldest Dow component rallied 3 percent on Monday after the industrial giant said it would merge its transportation business with Wabtec in a deal worth $11 billion. Still, the stock is 47 percent below its 52-week high, placing it firmly in bear-market territory.

Apple has dropped the price of its USB-C to Lightning cable by $6 to $19; it previously sold for $25. The price cut comes amid rumors that this year’s iPhones could include a USB-C to Lightning cable in the box and finally move on from the old USB-A cable. Currently, the USB-A to Lightning cable also costs $19. There’s also a rumor that Apple could introduce a new 18W USB-C Power Adapter that could fit into smaller areas compared to the current 29W adapter, as 9to5Mac reports.

Apple previously dropped the price of its USB-C to Lightning cable and other USB-C dongles in response to negative feedback about the MacBook’s move to USB-C ports. If the company’s best laptops are exclusively using USB-C, it makes sense for the iPhone to follow that trend — on one side of the cable, at least. USB-C cables are required for customers who want to use the iPhone’s fast charge capability.