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Whenever market leaders Apple and Samsung show off a new smartphone, their stock is guaranteed to tick up or down a notch, adding or subtracting billions of dollars from the tech giants’ valuation. But reaction isn’t limited to the tech companies that made those phones: Wireless carriers, online retailers, and electronics stores see their own stock prices soar or plummet in response — and, in some cases, they end up with higher percentage gains than the smartphone makers themselves.
This year, mixed reaction to Apple’s new line of iPhones ended up being negative for the company’s stock price, with shares initially climbing when CEO Tim Cook took the stage at the reveal on September 12, then tumbling after he introduced the iPhone 8 and the premium iPhone X. Stock ended the day down a little over $1 per share.
Retailers and cell service providers saw their own stock take a similar roller-coaster ride.
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Verizon, AT&T, and Sprint saw gains leading up to the reveal, as investors started buying stock in anticipation of the new phone. Then, like Apple, the carriers saw a small drop-off when the iPhone X was shown. T-Mobile was the exception; its share price shot up earlier in the morning and slowly lost momentum throughout the day.
Many smartphone users buy phones directly from their carriers. But for those companies, reveal day isn’t just about selling more phones — it’s an opportunity to have additional users add more lines to their service plan, see in-store clients splash out on a new cell phone case or other accessories — and ideally, attract new customers.
“Wireless carriers like AT&T and Verizon see these events as an opportunity to steal customers from their rivals,” Mike Dano, editor-in-chief of FierceWireless.com, told NBC News.
Retailers also saw some stock movement after Apple’s latest reveal. Amazon, Best Buy, Target and Wal-Mart sell the most iPhones after the wireless carriers, so investors were picking up shares before the presentation started. Then, like the carriers, retailers saw stock prices dwindle once the iPhone X was revealed. With the exception of Amazon, they ended the day on a positive note.
Samsung Galaxy product launches have a similar effect. The South Korean company’s two big smartphone reveals this year came with mixed results from Samsung investors — but generated millions of dollars in gains for the largest wireless companies.
When the Galaxy S8 was revealed in March, Samsung saw a slight increase in stock prices as investors put their faith in the fact that customers would upgrade their current Samsung phone.
But electronics stores saw a much bigger jump in value that same day.
“They get excited,” said Cliff Maldonado, founder of BayStreet Research. “If they can get you to their site or store, it’s a great beginning process to sell you a case, a screen cover, or something else.”
Samsung’s second reveal of the year, the Galaxy Note 8, saw losses and gains spread out among retailers and wireless carriers, showing that Wall Street didn’t care about the larger, more powerful Samsung smartphone.
One of the lone exceptions was Apple, whose stock went up half a percent when the Galaxy Note 8 was first shown.