Can Apple's Stock Recover Without Steve Jobs?

Apple's stock is going down like a plane in flames sinking 12 percent on its biggest fall since the 2008 Wall Street crash. That's $60 dollars per share just after they announced one of its best quarters in history... but still under analysts' expectations, who think the company is slowing down because its markets are saturated. The markets they created.

The problem now is: Will Tim Cook & Co. be able to create a new market that will allow Apple to grow wildly without Steve Jobs?

After looking at the numbers, financial companies are revising their estimates, arguing that they are slowing down. Morgan Stanley removed Apple from its best stocks list, while Jefferies set it to "hold" from "buy". Its analyst Peter Misek say that there is indeed a slow down in iPhone sales:

The slowdown in iPhone sales is real and material. While management was somewhat evasive on the call, it appears that demand in the second half of the quarter and into CQ1 was much weaker than management or we expected.

Apple's shares started going down after last September's high, when its shares closed above the $700 mark. The Cupertino company has lost $226 billion in market value since then. The times in which Apple closed above Exxon as the world's most valuable company feel very far away too. (Remember this?)

The real bad news

But the worrying news is not that the stock is tanking. That happens all the time—stocks going up and down. Besides, the stock was probably over real market value to begin with.

No, the real bad news is the fact that industry experts are seeing signs of slow down for Apple products. They are still selling well, but they are stabilizing (which is a slow down). This may explain the iPhone parts order cut reported by the Wall Street Journal and the New York Times.

When asked yesterday, Tim Cook said he wasn't worried. He said that they have plenty of new products in the pipeline. The question is: Would any of the new products ignite a fire in the market the way the iPod, the iPhone or iPad did? Or would they fall flat? Perhaps this is the biggest question that every shareholder has on their minds now:

Could Apple continue to thrive and be the world's most valuable company without Steve Jobs?

I said it then: the answer is probably no. I still find it amazing that Apple's capitalization went over ExxonMobil:

A couple decades ago it was just an overpriced beige box manufacturer with an obsolete operating system. I remember because I was a Mac fanboy then, when everyone was using Windows and Michael Dell said that the company should be sold as scrap and the money returned to its shareholders. [Ironically, Microsoft is now buying Apple in parts.]

Then Steve came back.

After the iPod, Mac OS X, the iPhone, and iPad, Apple has become the number one technology company in the world. Bar none. There's no company with better style, design sense, attention to detail, marketing and manufacturing precision. Apple is the best, and that's why most consumers crave its products. That's why the rest of the industry follows Cupertino too, even into entirely new markets.

It was Steve Jobs' unique vision and his strict command of a brilliant troop of engineers that made-and still makes-it all possible. Together, they created the future. Now Apple is the new Microsoft, and they control it all-from the hardware to the operating systems to the apps their operating systems run.

The same is true. Jobs had a vision that resulted in three new markets for Apple: iPod+iTunes, iPhone and iPad.

By creating these markets, Apple ensured themselves a lede into something completely virgin. And they made record numbers, which made the company's valuation skyrocket.

Now, as those markets have stabilized, they can't make such record numbers. And so, they slow down. The stock market is now realizing this—even while it was quite obvious before. But this is Wall Street, so they prefer speculation and exhilaration, rather than looking at things with a cold head.

Time to create a new market

Now, to keep the behemoth breathing and killing, Apple needs to create a new market. Virgin territory, a new gold rush. They can no longer profit at the same pace in saturated markets. They need to create new product categories.

And that's where Steve comes in. Or came.

Even while he probably left many projects running when he was still around, those have to be executed. They have to be turned from an idea into a flawless product.

So the question is, can they do that without the Wizard of Oz, the snake oil salesman, the amazingly brilliant asshole that is Steve Jobs?

I know that Jonny Ive is brilliant. So are Tim Cook and many others at Apple. But I don't think they have the vision that Jobs had:

I used to think that Apple could live without Jobs. Back in 2008 I wrote about how he was preparing his farewell and why I thought that, if he left, the company would be just fine. I was wrong.

Back then, investors disagreed with me. When we broke the news of the return of his cancer back in 2008, Apple lost billions in just a few minutes of trading. Back then, Apple and its friends at CNBC tried to deny the news that later was confirmed by Jobs himself.

The investors were right, and now I'm convinced that Apple can't be Apple without Steve.

It's going to be hard for the company to grow at the same rate of yesteryear if they can't create new markets. And the possibilities of doing that without Steve Jobs are low. Very low. That's how important his vision was.

If Apple can't achieve that, then it may end like Sony. A great company, with good products and good design, but just another company fighting to sell phones, tablets and computers.

At the end, that—and not the sightly-disappointing-but-record-breaking quarter—really is why everyone is selling.