Apple donates $1 million, iPads, other products to LGBTQ youth organization – CNET

Apple computers

Apple has earmarked at least $100 million to support social causes since this summer.

James Martin/CNET

Apple is helping a Utah-based nonprofit expand in four states, offering a community center for LGBTQ youths and families. The program, called Encircle, launched in 2017 and operates out of houses it remodels to offer services like art and music studios, community classes and service projects. It also offers free and subsidized group and individual therapy sessions.

"All people should feel safe and supported enough to be open about who they are with their community and themselves," Apple CEO Tim Cook said in a statement Thursday. "Encircle is helping to bridge divides and bring people together -- sending a powerful message that the greatest thing you can aspire to become is who you truly are."

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An Encircle home in Provo, Utah.

Encircle/Apple

Encircle said the money will help its efforts to open eight new homes in Arizona, Idaho, Nevada and its home state of Utah. Apple made its investment alongside Ryan Smith and his wife, Ashley, the owners of the Utah Jazz basketball team. Imagine Dragons lead singer Dan Reynolds and his wife, musician Aja Volkman, also donated Reynolds' childhood home to the organization. Apple will offer iPads and other products in addition to its $1 million donation.

The move marks Apple's latest moves with social justice initiatives, which expanded amid racial strife across the US last summer. At the time, Apple said it planned to spend $100 million on education, economic equality and criminal justice reform. Cook said back then it was in order to "challenge the systemic barriers to opportunity and dignity that exist for communities of color, and particularly for the black community."

Cook's signaled his interest in charitable giving short after being named CEO in 2011. About a month after he took the job, Cook dipped into Apple's pile of cash and equivalents, to start employee donation matching programs for up to $10,000 per year. In 2012, Cook told employees Apple had also given $50 million each to Stanford University and Product RED, a products brand of which a portion of proceeds go to help fight AIDS around the world.

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Tim Cook, during a virtual Apple product launch event, last year.

Apple

Cook, who grew up in Alabama during the 1960s and out as gay since 2014, has spoken out on LGBTQ issues.

Apple's $1 million investment in Encircle may seem small in comparison to some of its other efforts, but organization head Stephanie Larsen said its programs -- which have shifted online during the pandemic -- are as important as ever. "Studies repeatedly have shown that LGBTQ+ youth across the country struggle with depression and suicidality far more than their heterosexual peers, and the pandemic has made that sense of isolation so many feel harder than ever before," she said in a statement. "This incredible support makes our nationwide expansion possible and will improve countless LGBTQ+ lives -- reminding them that they are perfect, just as they are."

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Robinhood troubles: SEC will ‘closely review’ actions that restricted AMC, GameStop stock trades – CNET

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Robinhood was a popular stock market app. Now it's being called the Sheriff of Nottingham.

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Over the past week, the popular stock trading app Robinhood has drawn the ire of the internet as it restricted trades of GameStop, AMC and other wildly swinging stocks. The move interrupted, for a short time, a showdown between Reddit users and large investors that's become one of the biggest dramas in Wall Street history. Now, the Securities and Exchange Commission says it will "closely review" what happened.

In a statement Friday, the acting chair of the SEC and three commissioners said that it is "closely monitoring and evaluating the extreme price volatility of certain stocks' trading prices over the past several days." 

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The statement didn't mention Robinhood by name, but the commission said it would "closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities." 

Robinhood declined to comment about the SEC statement. The White House referred questions about GameStop and brokerage firms to the Treasury Department, which houses the SEC.

The announcement comes amid increased calls among internet traders for government regulators to closely scrutinize Wall Street trading apps, including Robinhood. Critics say the company, whose motto is to "democratize finance for all," acted dishonestly and may have manipulated markets when it appeared to halt purchases for GameStop and other stocks on Thursday. Robinhood at the time said its restrictions were to ensure it didn't run afoul of government regulations.

All this happened in the midst of a pitched battle between traders on the Reddit forum r/WallStreetBets and large Wall Street investors. The Wall Street investors had made big bets against GameStop's and AMC's success, which turned sour when WallStreetBets members invested in large numbers into GameStop. As GameStop share prices soared, Wall Street investor losses rose into the billions, driving even more share trading.

As trading volume for the various stocks has risen, stock market trading app brokerages have restricted trades by adding extra account requirements, among other things. Some investors have accused brokerages and app makers of attempting to manipulate the market, the companies say they're ensuring their companies work smoothly.

Meanwhile, Robinhood announced it had raised $1 billion from its existing investors, "to invest in record growth." Though some media reports say Robinhood's drawn down on its credit as well to help stabilize its business amid the havoc.

The SEC's investigation may ultimately help to more directly identify the brokerage's behavior.

"Our core market infrastructure has proven resilient under the weight of this week's extraordinary trading volumes," the commission added in its statement. "Nevertheless, extreme stock price volatility has the potential to expose investors to rapid and severe losses and undermine market confidence."

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Robinhood troubles: SEC will ‘closely review’ actions that restricted AMC, GameStop stock trades – CNET

Robinhood

Robinhood was a popular stock market app. Now it's being called the Sheriff of Nottingham.

Getty Images

Over the past week, the popular stock trading app Robinhood has drawn the ire of the internet as it restricted trades of GameStop, AMC and other wildly swinging stocks. The move interrupted, for a short time, a showdown between Reddit users and large investors that's become one of the biggest dramas in Wall Street history. Now, the Securities and Exchange Commission says it will "closely review" what happened.

In a statement Friday, the acting chair of the SEC and three commissioners said that it is "closely monitoring and evaluating the extreme price volatility of certain stocks' trading prices over the past several days." 

Now playing: Watch this: What does GameStop's skyrocketing stock have to do with...

10:15

The statement didn't mention Robinhood by name, but the commission said it would "closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities." 

Robinhood declined to comment about the SEC statement. The White House referred questions about GameStop and brokerage firms to the Treasury Department, which houses the SEC.

The announcement comes amid increased calls among internet traders for government regulators to closely scrutinize Wall Street trading apps, including Robinhood. Critics say the company, whose motto is to "democratize finance for all," acted dishonestly and may have manipulated markets when it appeared to halt purchases for GameStop and other stocks on Thursday. Robinhood at the time said its restrictions were to ensure it didn't run afoul of government regulations.

All this happened in the midst of a pitched battle between traders on the Reddit forum r/WallStreetBets and large Wall Street investors. The Wall Street investors had made big bets against GameStop's and AMC's success, which turned sour when WallStreetBets members invested in large numbers into GameStop. As GameStop share prices soared, Wall Street investor losses rose into the billions, driving even more share trading.

As trading volume for the various stocks has risen, stock market trading app brokerages have restricted trades by adding extra account requirements, among other things. Some investors have accused brokerages and app makers of attempting to manipulate the market, the companies say they're ensuring their companies work smoothly.

Meanwhile, Robinhood announced it had raised $1 billion from its existing investors, "to invest in record growth." Though some media reports say Robinhood's drawn down on its credit as well to help stabilize its business amid the havoc.

The SEC's investigation may ultimately help to more directly identify the brokerage's behavior.

"Our core market infrastructure has proven resilient under the weight of this week's extraordinary trading volumes," the commission added in its statement. "Nevertheless, extreme stock price volatility has the potential to expose investors to rapid and severe losses and undermine market confidence."

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AMC and GameStop stocks swing wildly as Reddit’s bets against Wall Street are tested – CNET

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Some Reddit investors are seeing their millions go up in smoke.

CNET

GameStop and AMC stocks at the center of a multibillion dollar drama between Wall Street investors and social media traders on Reddit have dropped dramatically Thursday. GameStop shares jumped to a high of $483 per share early in the day halved to around $246 midday ET, only to rally minutes later to more than $300. AMC similarly had gone as high as $16.50 per share before dropping to about $8 before inching up to $9.50. 

The moves came after popular stock trading apps such as Robinhood and TD Ameritrade announced they would restrict trades of stocks being heavily bet on, including GameStop and AMC. The New York Stock Exchange as well has stepped in amid the frenzy, temporarily halting AMC trading at least 10 times since the market opened at 9:30 a.m. ET, and GameStop shares at least a dozen times.

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The moves mark the spectacle of what some investors call a "war" between Wall Street and social media traders. The Reddit community r/WallStreetBets has become a central hub of a financial push to hurt Wall Street investors who bet big against GameStop's future. As the social media investors pushed shareas of the company up, Wall Street's had to recalibrate its bets, pushing shares beyond their all-time highs.

Reddit users have expressed furor at Robinhood and TD Ameritrade for restricting trades, with threats of lawsuits already spreading around social media. 

Meanwhile, social media traders are encouraging fans to "hold the line," as they call it, and not sell off their shares. That may have helped the share prices creep back up after their dramatic drops.

Read more: AMC, GameStop stocks go wild: Reddit's 'insane' 'Ponzi scheme' can't last

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Reddit’s battle with Wall Street over AMC, GameStop stock a ‘Ponzi scheme,’ can’t last – CNET

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GameStop shares are on an epic roller coaster that pushed them to the stratosphere. But for how long?

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Many of today's adults spent their youths in GameStop stores. They lined up for console launches. They bought and sold games there, too. Now some of those gamers are rich after buying GameStock's stock and encouraging their friends on Reddit to buy it too. GameStop's shares rocketed higher than ever expected in the past couple weeks, and all because activity among social media investors began pushing it up. Wall Street had bet heavily that the company would fail, but as the price kept going up, investors were forced to reset their wagers. That led the stock to rocket up, and then swing wildly.

And though the share price dipped on Monday, Feb. 1, by more than 30%, many Reddit users say they're buying more GameStop stock, convinced it'll rocket even higher.

Jaime Rogozinski, the apparent founder of the Reddit community at the heart of all this, told The Wall Street Journal it's like "a train wreck happening in real time." Keith Gill, the trader in the Reddit community who helped kick off the battle, told the paper he "didn't expect this."

Last week, on Thursday alone, GameStop's stock hit all-time highs of $492.02 per share, only to drop by more than half a minute later. It closed trading at $325 the next day.

GameStop itself hasn't fundamentally changed in the past month. It's still a struggling retailer facing an uncertain future against the rising tide of online shopping. But its stock has shot up as much as 1,800% -- that's not a typo -- since the beginning of the year. This dynamic's led Wall Street investors who bet against the company's future to lose billions of dollars, and the excitement is driving the hype even further.

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Over the past couple weeks, the financial world watched in shock as GameStop stock (or "stonk" as the reddit community calls it) rose to unthinkable levels. Even Elon Musk tweeted about it, pointing his 43 million followers to a link of the Reddit community investing in GameStop, called r/WallStreetBets.

By the close of regular trading on Wednesday, Jan. 27, the stock was $347.51 per share, up from from historic lows of around $3.30 per share in the summer of 2019. And then in after-hours trading, it dropped by more than 37%, only to rise again. The next day saw even more dramatic moves, with the stock jumping up to $492.02 before dropping nearly 60% to close at $197.44. Then, in after-hours trading, it rose back up to $311.99.

Meanwhile, stock market trading apps appeared to either stop or impose restrictions on GameStop share purchasing for at least part of the day. 

The popular stock trading app Robinhood drew particular attention for what appeared to be the among the most restrictive new rules. People had been raising concerns about Robinhood for a while, saying it "gamified" stock trading to a potentially dangerous degree. Now it's being accused of outright market manipulation, including through at least one class action lawsuit filed already. Robinhood, for its part, said last week that market rules effectively forced it to put those restrictions in place.

Read more: GameStop's stock spike fueled by slang from Reddit's r/WallStreetBets community. Here's what it means

"We're seeing a phenomenon that I have never seen," Jim Cramer, a Wall Street commentator on CNBC and a former hedge fund manager, said during a segment as shares were first beginning to swing. And GameStop could be just the start. "It's insane."

This may seem like an oddball story about Wall Street investors being overrun by excited social media users. For some, it's been fun to watch those investors get taken to the cleaners by a bunch of people posting rocket emojis, saying GameStop shares will go "to the moon."

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Reddit users are betting they can take GameStop shares "to the moon."

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But for some on Wall Street, it's the latest sign of how social media can upend everyday life. Twitter has changed the worlds of news and politics. YouTube and Instagram have transformed the fashion, beauty and entertainment industries. Now Reddit is taking on Wall Street.

These worlds have overlapped as well. Fans of Korean pop groups, known as K-pop stans, post floods of tweets about their favorite stars to overwhelm racist hashtags on Twitter. And TikTokers banded together in attempts to confuse President Donald Trump's reelection campaign.

Now emboldened Reddit communities are talking about taking on other companies that Wall Street is broadly betting against. The Reddit crowd is already attempting to push up BlackBerry, the once-popular handset maker that now focuses primarily on selling business software. And Redditors are also targeting the struggling movie chain AMC, pushing its stock from hovering around $2 per share to more than $8 in after-hours trading. By Wednesday, Jan. 27, it closed at $19.90 per share before dropping to $12.75. The next day, it fell even further, to $8.63 per share.

The Reddit community's actions have had such an impact that TD Ameritrade took the extraordinary step last week to limit share trading on Game Stop and AMC stocks, "out of an abundance of caution amid unprecedented market conditions." Nasdaq as well warned that it will halt trading on stocks it thinks are being manipulated by social media.

Meantime, traffic to the Reddit community at the center of the drama, r/WallStreetBets, is breaking records. Mashable reported that r/WallStreetBets counted 73 million page views for its discussion boards on Tuesday, Jan. 26, as stocks began to swing. Over a seven day span, it hit about 700 million page views. Reddit is already the 46th most popular site on the web, notching more than 78 million unique visitors in December, according to comScore. And on Wednesday, Jan. 27, Reddit's mobile app tallied its biggest single day of downloads, industry watcher Apptopia said.

The whole drama's even caught the attention of Saturday Night Live, which lampooned the Reddit investors as the latest sign Wall Street isn't working.

But when the memes stop and the excitement goes away, GameStop will go back to being that struggling video game retailer at a time when gaming is increasingly moving toward streaming and the idea of stepping into a physical store is still a nerve-wracking prospect during a pandemic. At that point, stock analysts say, whoever's left holding shares will see their value evaporate.

"This is unnatural, insane and dangerous," Michael Burry, a prominent GameStop investor and one of the subjects of the book and movie The Big Short, wrote in a now-deleted tweet. His roughly $17 million investment in the company ballooned to at least $250 million last week, give or take a few swings in the share price, Markets Insider reported.

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Many gamers spent their childhoods going to GameStop.

Patrick T. Fallon/Bloomberg/Getty Images

No one's listening

Michael Pachter, a longtime video game industry analyst at Wedbush Securities, said he hasn't even bothered to update his stock price expectations for GameStop since shares started going crazy. "Who's listening?" he said in an interview last week. "Nobody cares what a sell-side analyst says right now."

To him, there are reasonable explanations why people could be somewhat excited about GameStop. One of its newest board members, Ryan Cohen, helped turn Chewy into one of the largest online pet product sellers in the world, before selling it to PetSmart. GameStop's also on a track to being profitable again.

But that doesn't come close to explaining GameStop's share price now. "It's a Ponzi scheme," Pachter said, referring to a form of fraud that appears to make money but in fact is only propped up by funding from new investors. "There is a point where it'll go down."

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Many of the Reddit users buying up GameStop shares see this as a way to fight Wall Street greed.

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He suspects that may happen after the company reports its quarterly results in March, at which point executives and investors on the board are allowed to sell their shares.

In the meantime, industry watchers are attempting to understand what forces are at play in the drama, and what these swings say about the economy.

"When you see what's happening with GameStop, you ask yourself, is this manipulation, is this mass psychosis or is there something wrong in our market structure that is causing this to happen," James Angel, a finance professor at Georgetown University's McDonough School of Business, told the New York Times.

One thing analysts watching wonder is whether the Reddit investors will lose their millions whenever the stock eventually crashes back to earth. Rogozinski, the man who helped found the Reddit community, said their approach to investing as more like gambling than traditional analysis and strategy. Its members, who the community identifies as "degenerates," often encourage one another to push all their funds into one stock, riding it up and down. Their posts are punctuated with phrases like "hold the line" and "diamond hands" (hold onto your stocks for a long time) and YOLO (you only live once).

He told the WSJ he never imagined the Reddit community would morph from its beginnings to what it's become. "It's a little like watching one of those horror films where you can see the bad guy slowly going up the stairs," Rogozinski said.

Indeed, even Keith Gill, the community member who helped kickstart the initial battle over GameStop, told the Journal he was surprised by what it'd turned into.

"I thought this trade would be successful," he said, "but I never expected what happened over the past week."

In the meantime, the social media hype is continuing on Reddit, where users are declaring their intention to buy and hold more GameStop shares, all to send prices even higher.

"My mom told me it's time to sell," one Reddit user wrote on a post about GameStop's stock moves. "Should I find a new mom?"

"Yes," another user answered. "The answer is yes."

Read more: Why GameStop, BlackBerry stocks suddenly jumped, thanks to Reddit

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Reddit’s WallStreetBets is back, taking on GameStop stock after intentional lockdown – CNET

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One of Reddit's most active communities is no longer public.

Reddit

For the past week, Reddit's r/WallStreetBets community has been the center of an epic war between large Wall Street investors and small-scale social media betters. On Wednesday evening, the community reeled from seeing the subreddit locked and hidden, only to be made public again about an hour later. Meanwhile, chat app Discord has banned WallStreetBets outright. 

Around the same time, spooked investors appeared to dump GameStop and AMC shares the community had been buying up to take on people betting against the company's futures. 

Then, as suddenly as everything began, the subreddit came back, a new Discord community was formed, and others bought in to the stocks, sending AMC and GameStop prices back up.

OK.

If all this is confusing, don't feel bad. These fast and dramatic moves are happening amid one of the most dramatic weeks on Wall Street in years. At stake are millions of dollars that small-time investors working together on social media have made while taking on Wall Street investors who bet GameStop and AMC stock would plummet. Instead, as the two company's stocks have soared, the Wall Street investors have reportedly hemorrhaged billions of dollars.

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As the drama unfolded from the Discord ban and the Reddit community going on lockdown, GameStop shares fell 32% in after-hours trading late Wednesday, to $218.32 per share, down from $347.51 at their close. During the day, they'd more than doubled. AMC shares also fell, dropping more than 40%, to $11.90 per share, after closing at $19.90. That stock had risen more than 301% during the day.

Both stocks have recovered somewhat, and the r/WallStreetBets community is back. If you'd taken an hour and a half to watch Pixar's new movie, Soul, you'd have missed it.

Though GameStop shares have been jumping in recent days, analysts and experts say they're doing so because of quirks in the market and not because of actual increased value for the struggling video game retailer. The same is true for the movie theater chain AMC, which had warned it was near bankruptcy late last year.

All this wasn't the only bad news for the WallStreetBets community. Its worst community members, who repeatedly broke Discord's rules, caused the group to be banned from the platform, the chat app company said in a statement. "Today, we decided to remove the server and its owner from Discord for continuing to allow hateful and discriminatory content after repeated warnings," Discord said. It added that the ban had nothing to do with any talk of finances or stock that happened among WallStreetBets users.

Elon Musk, the CEO of Tesla who's helped to drive attention to the GameStop stock madness, tweeted his disappointment with Discord Wednesday.

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Apple’s iPhone 12 led to largest revenue and profit in company history – CNET

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Apple's iPhone 12 was expected to be a big hit, with its new design and 5G wireless.

Angela Lang/CNET

Apple's iPhone sales surged to their highest point ever, as eager fans snatched up the company's new iPhone 12 during the holiday shopping season, despite the continued spread of the coronavirus.

The three months of Apple's fiscal first quarter included the launch of its new series of phones, ranging from the $699 iPhone 12 Mini to the $1,099 iPhone 12 Pro Max. They weren't all that was happening, though. The company also expanded its computer lineup with new customized chips similar to the ones that power its iPhones and iPads. And Apple expanded its services with the $10 per month Apple Fitness Plus digital health class offering and its Apple One bundle pricing, offering access to its TV, music and data storage services starting at $15 per month.

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All told, Apple said it notched profits of nearly $28.8 billion, up about 30% from the same period last year.  That translates to $1.68 per share in profit, from $111.4 billion in overall revenue, which itself was up more than 21% from the $91.8 billion reported last year. It was also enough to beat average analyst estimates, which were $1.41 per share in profits, from $103.3 billion in revenue, according to surveys published by Yahoo Finance.

For Apple, that all added up to the largest corporate profits and revenues it's ever had. It also brought Apple revenues above $100 billion for the first time.

"It is not far from any of our minds that this result caps off the most challenging year any of us can remember," Apple CEO Tim Cook said in a call with investors Wednesday. "It is an understatement to say that the challenges it posed to Apple as a business paled in comparison to the challenges it posed to Apple as a community of individuals, to employees, to their families, and to the communities we live in and love to call home."

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Apple's new iPhones, Macs and Apple Watches contributed to its best quarter ever.

Andrew Hoyle/CNET

"These results show the central role that our products played in helping our users respond to these challenges," Cook added.

Apple's stock closed regular trading down nearly 1% to $142.06 per share, and fell nearly another 2% in after-hours trading. The company's shares have risen nearly 10% so far this year.

Apple's growth underscore how much we've all come to rely on tech companies amid the COVID-19 pandemic. As the disease upends billions of lives around the world, forcing many people to quarantine at home, we've turned to computers, smartphones, social networks and collaboration software to help us keep working and learning. 

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Big tech has gotten bigger during the pandemic.

CNET

Earlier today, Facebook posted a big rise in revenue as earnings topped expectations. Amazon saw "record demand" over the past year, and particularly during the holiday shopping season, as people chose to shop online rather than brave possible infection in stores. Google, and its parent company, Alphabet, as well have outperformed even Wall Street's rosy expectations as marketers spend big to get people's attention online. 

And Slack, the business collaboration app, was sold to software giant Salesforce for $28 billion, nearly twice its value before it went public in 2019.

Cook said Apple is working to help its communities recover by creating programs to encourage students to study technology and new developers to make apps. It's also invested money to help promising new startups.

"We are doubly aware that the work ahead of all of us to navigate the end of this pandemic to restore normal life and prosperity in our neighborhoods and local economies, and to build with a sense of justice is profound and urgent," Cook added.

Hitting new records

Apple didn't just appear to navigate the pandemic, it's become a central answer to it. Each of Apple's businesses grew at double-digit rates, showing how people turned to its entertainment, health and education-focused products throughout the year.

The iPhone in particular showed strong growth, hitting $65.6 billion in sales, up more than 17% from the $56 billion it reported last year. And that's despite some iPhone models still being hard to find despite having launched in October.

"We had a record number of device activations during the last week of the quarter," Cook said, adding that Apple counts 1 billion active iPhone users around the globe. And, he said, they're using Apple's services in addition to their devices. "And as COVID-19 kept us apart, we saw the highest volume of FaceTime calls ever this Christmas."

Apple said it should have enough iPhones to meet demand by the end of March.

Though the iPhone was a standout part of Apple's business, each of Apple's other divisions reported revenues that rose at least 20%. That included its Mac business, which hit nearly $8.7 billion in sales, iPad, which grew to $8.4 billion, and "wearables, home and accessories" like AirPods and HomePods, which hit nearly $13 billion. 

The company's services business, which include the $5 per month Apple TV Plus subscription service and new $10 per month Apple Fitness Plus, rose to more than $15.7 billion.

All that's contributed to Apple's cash pile, which is now more than $195 billion.

Cook did acknowledge though that Apple's successes stand in contrast to suffering around the rest of the world.

"Entire portions of our lives that we took for granted -- schools for our children, meetings with our colleagues, small businesses that have endured for generations -- have simply disappeared," he said. "It will take a society wide effort across the public and private sectors as individuals and communities, every one of us, to ensure that what's ahead of us is not simply the end of a disease, but the beginning of something durable and hopeful."

Read more: Facebook shows growth in fourth quarter but sees challenges ahead

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GameStop stock dropped, but Reddit still hopes to send it to the moon. Here’s what’s next – CNET

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GameStop's and AMC's stocks have been on an epic rollercoaster ride. Here's what's going on.

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For a while, the little guy was on a roll. A bunch of Reddit users bought up shares of video game retailer GameStop, taking on Wall Street investors who'd bet the company would fail. Wall Street had bet against GameStop so much and for so long that at times was one of the most heavily bet-against stocks on the market.

So, when people in the Reddit community r/WallStreetBets began pushing up GameStop's share price, it began to cost establishment investors billions and billions of dollars. GameStop's shares have been swinging wildy, going from about $17 at the start of the year to $483 last week and then to $90 by the close of Monday's trading. Shares rose slightly on Tuesday to hover around $95, but were still down more than 80% from their highs last week.

What makes this roller coaster unusual is why the Reddit community ia buying up GameStop shares. While some of them say they believe in GameStop's future, others are attracted to the idea that the higher GameStop's shares go, the more Wall Street's bad bets will cost institutional investors money.

"It's become political," said Derek Horstmeyer, a professor of finance at George Mason University. He'd been watching WallStreetBets forums for a year and a half and see community members take "insane" positions in the market, throwing all their money into a position that sometimes wins big and sometimes loses even worse. 

But the fight against Wall Street is different, he said. Many of them are angry at big investor's behavior over the past decade, be it when many were bailed out during the financial crisis or watching them make even more money as people suffer during the coronavirus pandemic. 

Now playing: Watch this: What does GameStop's skyrocketing stock have to do with...

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As GameStop's stock's withered, r/WallStreetBets traders have been posting that their fight against Wall Street isn't over and that, in fact, the stock will likely jump again on the backs of Wall Street's still bad bets.

Regardless of how the battle over GameStop ends, investors and industry watchers say the online forums have shown they can be a force in the market. "I think now that they've recognized their power and now that they've learned some lessons, we're going to get more of it, not less of it," billionaire investor and Dallas Mavericks owner Mark Cuban told CNBC on Feb. 2. 

He also gave a pep talk to the r/WallStreetBets forum that day, posting that the group had changed investing in big ways. "No disruption is easy or happens in a straight line," he said. "Stay with it. I am a believer."

The current low point for GameStop's stock is just the latest among twists and tales that have come to make up a crazy story. And aside from Cuban, other celebrities have gotten involved, including by Tesla CEO Elon Musk and CNBC financial commentator and former hedge fund manager Jim Cramer. There's even Michael Burry, one of the subjects of the book and movie The Big Short, who happens to be a prominent investor in GameStop. 

Even Silicon Valley found a way to get in the middle of this mess. It's wild.

Despite the move being characterized as "insane" and a "Ponzi scheme," "market manipulation" and "mass psychosis," GameStop's stock has become the theater for a war between Wall Street and internet traders. Nearly all of them expecting it to fail. The questions are when, and who will be on the losing end when it does.

"We're seeing a phenomenon that I have never seen," Cramer said during a segment as GameStock's stock began rocketing up. And GameStop could be just the start. "It's insane."

It's not just GameStop either. Reddit traders set their eyes on BlackBerry too, attempting to pull the same trick against Wall Street's negative bets. So far, they've pushed shares up more than double from $6.58 per share, where they started at the beginning of the year, though its price has swung up and down as well..

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GameStop's stock's been going wild.

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There's also AMC Theaters, which saw its business crater as movie releases were pushed back and people stayed at home. But Reddit users think Wall Street's being overly pessimistic about that one too, leading them to spawn the hashtag #SaveAMC on Twitter. Its stock jumped from $2.01 per share at the beginning of the year to $19.90 on Jan. 27, before halving the next day.

Some trading companies such as Robinhood, TD Ameritrade and WeBull responded to the fluctuations by restricting trades of GameStop, AMC and other fast-moving stocks during the chaos.

Robinhood drew particular ire, leading US Reps. Rashida Tlaib and Alexandria Ocasio-Cortez, as well as Sen. Ted Cruz, to criticize its decision. Some people had already raised concerns about Robinhood before, saying it "gamified" stock trading. Now it's being accused of outright market manipulation, including through at least one proposed class action lawsuit filed already. Robinhood, for its part, said market rules effectively forced it to put those restrictions in place.

It's a lot to take in. So, here's what you really need to know about GameStop, AMC and Wall Street.

How'd all this start?

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GameStop is one of the largest video game retailers in the world, but it's struggled to remain relevant in the age of online sales.

Effectively, the r/WallStreetBets crowd realized Wall Street made a huge mistake. People known as short sellers who were betting GameStop stock would fall had been too aggressive. 

The r/WallStreetBets crowd understood that if they could create artificial demand for GameStop shares with their own money, they could force Wall Street to recalibrate its bets, pushing prices even higher. And some investors who couldn't even back up their bets against GameStop, would have to pay even more. 

As of Jan. 27, there were 3.8 million members of the r/WallStreetBets community, though it's nearly impossible to determine how many people are involved in the GameStop, AMC and BlackBerry schemes.

What we do know is that all this activity appears to have created a "short squeeze," where the short sellers betting against GameStop are being forced to buy more GameStop stock to cover their losses. That pushed the price up even more, which forces more short sellers to cover their losses, which pushes the price up even more. Some of the Reddit crowd believe that GameStop stock could reach into the thousands of dollars just because of this mechanism.

And that's why we're seeing GameStop's value swing up and down.

See also: GameStop's stock spike fueled by slang from Reddit's r/WallStreetBets community. Here's what it means

How does short selling work?

When people buy a stock normally, they're betting it'll rise or share enough profits that they'll make more money than they put in.

Short sellers, or "shorts," do the opposite. Shorts trade with borrowed shares and sell them, with hopes they can make money if the stock falls in the future.

Imagine Ian Corp. is a public company, and its shares are worth $10. A "short" would borrow shares of Ian Corp. and sell them for $10. Their bet is that Ian Corp. stock will actually drop below that -- maybe to $4. If it does, then, they can buy the shares at $4 and pocket the other $6.

If Ian Corp. stock jumps to $25, then the lender who made this bet possible may push the short to cover their bet. That would mean the short effectively has to buy the shares at the new, higher price.

When a short is right, betting against a company, they can make a lot of money. But if they're wrong, they can lose a lot more money too.

There are other options and tools to bet against a company's future as well.

Tracking GameStop's stock price mid-January

GameStop stock from Jan. 19 to Jan. 25.

Google Finance

How much did GameStop shorts lose?

The losses appear to be tremendous. As of Jan. 27, shorts seemed to have lost $5 billion betting against GameStop this year, according to Investopedia. About $1.6 billion, or about half, of those losses happened on Friday, Jan. 29, when the stock jumped 51%.

It's also worth noting that GameStop began the year as one of the most shorted companies on the market.

That's a lot

It is, but what's perhaps an even bigger indication of how dramatic these moves were, stock markets temporarily halted share trading for AMC, GameStop and other fast moving shares dozens of times since the drama began.

See also: How to choose a credit card

You keep saying the stock's swinging wildly. What do you mean?

The r/WallStreetBets crowd had been pushing up GameStop's stock for a while, believing Wall Street investor's bad bets would turn so sour that they'd cause a market rally.

By Monday, Jan. 25, that's exactly what happened. GameStop stock jumped more than 822%, from $17.25 per share at the beginning of the year to a high of $159.18 that day. The next day, it dropped by nearly half, only to rise back up. And then Elon Musk tweeted about it to his 43 million followers (using that weird internet vocabulary, of course), and the price jumped 40%. 

Later that week, the stock jumped even higher, to $483 per share, before halving again. Amid all the chaos, the stock market temporarily halted GameStop share trading more than a dozen times some days because share price moves were wildly swinging by large amounts. On Feb. 1, the stock price fell more than 30% to $225, and on Feb. 2 it fell another 60% to close at $90.

How long will these share price swings continue?

Part of what's driven this behavior is the popularity of retail investing, or when traders who aren't Wall Street professionals buy and sell stocks. Stock trading apps, often with no fees, have made it easy for people to jump into the market. And social media has helped people to rally together, egging one another on to buy more and more of a stock.

"GameStop's rally is one in a series of eye-catching market moves to stir concerns among fund managers, some of whom say trading by individual investors is pushing stock prices out of whack with fundamentals," The Wall Street Journal wrote when the drama began.

That said, it's hard to pin all dramatic market swings on the r/WallStreetBets traders. For example, the value of silver jumped to eight-year highs on Monday, Feb. 1, but people in the Reddit community say they aren't the ones doing it. 

What does Wall Street say?

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Many Reddit users accuse Wall Street investors of manipulating the market against them.

Getty Images

Big name trading apps like Robinhood, ETrade and others have reportedly struggled to remain online amid all the hysteria. TD Ameritrade on Jan. 27 acted to restrict the sudden spikes in demand, "out of an abundance of caution amid unprecedented market conditions."

Robinhood has also come under particular scrutiny for appearing to severely restrict trades of some stocks while the market was wildly fluctuating that week. Politicians on both sides of the aisle in the US have called for an investigation into the app maker. Meanwhile, many angry Redditors say they'll stop using Robinhood. Some have even threatened to join a class action lawsuit.

Nasdaq said it will halt trading on a stock if it finds a link to unusual activity on social media. The company said it sees its role as a "self-regulatory organization" is to make sure its markets act in a "legitimate" way. "Regulators kind of have to catch up with the technology that's now available," Nasdaq CEO Adena Friedman told CNBC on Jan. 27. 

Throughout the past week, the markets have temporarily halted trades of GameStop and AMC stocks in particular because of the wide price swings and heavy volume.

What does the government say?

Last week, the White House and Securities and Exchange Commission both indicated the administration was reviewing what was happening. On Wednesday, Feb. 3, Reuters and the Washington Post reported that Treasury Secretary Janet Yellen and other top financial regulators would meet amid increasing calls for financial oversight.

"Secretary Yellen believes the integrity of markets is important and has asked for a discussion of recent volatility in financial markets and whether recent activities are consistent with investor protection and fair and efficient markets," Treasury spokeswoman Alexandra LaManna said in a statement to the Washington Post. 

The department did not immediately respond to a request for additional comment.

I heard people are angry at Robinhood, too. Why?

Of the stock trading apps, Robinhood appeared to be the most aggressive in shutting down purchases of highly volatile stocks like GameStop and AMC. The company hasn't given clear reasons, other than vaguely saying it's working in the interest of users. But the US government may not agree.

On Jan. 29, the Securities and Exchange Commission said it's "closely monitoring and evaluating the extreme price volatility of certain stocks' trading prices over the past several days." 

The statement didn't mention Robinhood by name, but the commission said it would "closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities." 

Robinhood declined to comment about the SEC statement. The White House referred questions about GameStop and brokerage firms to the Treasury Department, which houses the SEC.

What did Robinhood say?

Robinhood

Members of Congress have their eyes on Robinhood.

Getty Images

On Jan. 29, the company published a blog post explaining that the company it works with to help users trade stocks was what had set off all the drama. That company, a clearinghouse that helps facilitate the transaction of stocks and cash between buyers and sellers, requires Robinhood and other trading companies it works with to have a specific amount of money in deposits each day to cover their customer's stock trades. That amount changes each day, based in part on market volatility.

Robinhood said the increased share trading led its clearinghouse to demand Robinhood increase its deposits tenfold. "That's what led us to put temporary buying restrictions in place on a small number of securities that the clearinghouses had raised their deposit requirements on," the company said. The requirements were so large, it said, that it had to restrict trades in order to meet its requirements. 

"It was not because we wanted to stop people from buying these stocks," the company added. "This is a dynamic, volatile market, and we have and may continue to take action to make sure we meet our requirements as a broker so we can continue to serve our customers for the long term."

Has Robinhood been in trouble with regulators before?

It has. A little over a month ago, on Dec. 17, the SEC charged Robinhood with "repeated misstatements that failed to disclose the firm's receipt of payments from trading firms for routing customer order to them." What that means in plain English is that Robinhood didn't tell users that their share trades might be accessible by people competing against them in the market.

Robinhood made its name by offering stock trades without a standard commission that people often payed at other firms. The SEC said that between 2015 and 2018, Robinhood made misleading statements and omissions, including "in FAQ pages on its website, about its largest revenue source when describing how it made money – namely, payments from trading firms in exchange for Robinhood sending its customer orders to those firms for execution, also known as 'payment for order flow.'"

The SEC estimated that Robinhood's approach deprived users of $34.1 million, even after taking into account the savings from not paying a commission.

Robinhood agreed to pay $65 million to settle the charges "without admitting or denying" the SEC's findings.

"There are many new companies seeking to harness the power of technology to provide alternative ways for people to invest their money," Erin E. Schneider, director of the SEC's San Francisco regional office, said at the time.  "But innovation does not negate responsibility under the federal securities laws."

What does GameStop say?

GameStop didn't respond to a request for comment. BlackBerry executives told MarketWatch it was "not aware" of any reason for the recent trading activity. BlackBerry did reach a settlement with Facebook earlier this month over a patent fight, though the terms were not disclosed.

Why is the Reddit community doing this?

There's the seeming easy money aspect, which is compelling in and of itself if you're that comfortable with risk. But some of them are also framing this as a crusade against Wall Street. "We're in a war," one Redditor posted. "A war for the redistribution of wealth."

You promised Elon Musk, I want Elon Musk.

Aside from being a prolific Twitter user, Musk has also recently learned he can drive people to various companies' stocks. He tweeted about how much he enjoyed buying something for his dog off Etsy, and the stock jumped. Now he's tweeted about GameStop, stirring up more frenzy.

Have any other notable people weighed in?

If you're a fan of Comedy Central's The Daily Show, Jon Stewart posted his first ever tweet in support of the Reddit crowd on Jan. 28. Among other things, he also said we clearly hadn't learned from the financial crisis.

I went to r/WallStreetBets and saw a post of someone's brokerage account worth tens of millions of dollars in GameStop stock.

That's Keith Gill, or Roaring Kitty on YouTube, one of the first people to kick off this rally. He spoke to The Wall Street Journal, telling his story about how he never expected this to happen. 

He posts a screenshot of his share values from his ETrade brokerage every trading day, in what he calls a YOLO ("You only live once") update. Many r/WallStreetBets members cite his holding onto shares despite stock fluctuations as inspiration for them to hold as well. "REMEMBER: If [he] can hold even through a 130% dip, so can YOU," one Reddit user posted as the stock started to fluctuate.

"I thought this trade would be successful," Gill told the Wall Street Journal in the story published Jan. 29, "but I never expected what happened over the past week."

This is nuts

It is. Saturday Night Live, of course, got a good laugh over the whole thing when the comedy show lampooned the Reddit investors.

"This is crazy, dude," said SNL's stand-in for the Reddit investors. "I put all my money in GameStop and I can't lose."

Aside from the good laughs, just watching this drama is enough to make your head spin. For example, on Jan. 27, the popular chat app Discord temporarily banned the r/WallStreetBets community from its service for violating its rules against hate speech and glorification of violence. Apparently, some of the nastier elements of the community had repeatedly broken Discord's rules. Discord said the group needed to do a better job keeping control of that behavior.

The group in charge of the r/WallStreetBets Reddit board made it private during one evening, locking out anyone else who might be interested in joining.

That appeared to spook investors, who suddenly sent GameStop and AMC stock diving that same time. Soon, the group was publicly available again. And  it reversed the ban and promised to work with the community instead.

A little over an hour later, the Reddit community was publicly available again, denizens had created a new Discord chat group, and GameStop and AMC stocks were recovering from their sudden slumps. If you'd put down your phone to watch a movie before it happened, you might never have noticed by the time it was done.

Except you may have seen Elon Musk tweeted about how Discord wasn't cool anymore (Discord eventually reversed its decision.)

What about The Big Short guy?

Michael Burry is an interesting subject himself. He became famous for betting against the housing market before the great recession kicked in around 2007 and 2008. He'd invested in GameStop but also said he believed all this behavior was "unnatural, insane and dangerous."

Of course, some of the Reddit members say they see this battle over GameStop as their Michael Burry moment, making it all that much more interesting.

Should I get in on the frenzy?

It's always smart to consult a financial professional before making investing decisions.

Correction Jan. 25 at 5:52 p.m. PT: Fixed the explanation of short selling to make clear how the process works and that there are different ways to bet against a company's stock price rising.

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We’re about to learn if Apple’s iPhone 12 is a smash hit – CNET

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Apple's about to share its first financial report since last year's iPhone 12 launch.

Andrew Hoyle/CNET

Apple's iPhone is already one of the most popular consumer products ever. And normally, it's a safe bet that when Apple makes big changes to its design, as it did to the iPhone 12, sales go into overdrive. But this past year has been anything but normal.

In February, Apple warned that sales and manufacturing for its products were likely to be impacted by the coronavirus. Soon after, economies around the world slid into recession and unemployment rates soared as the pandemic upended our way of life and kept us locked down in our homes.

On Wednesday, Apple's expected to release sales and profit data for the holiday shopping season, which typically stretches from October through December. That period was particularly busy for Apple too, including the launches of its highly anticipated iPhone 12 with 5G wireless and new laptop and desktop computers. The company also expanded its services with the $10 per month Apple Fitness Plus digital health class service and its Apple One bundle pricing, offering access to its TV, music and data storage services starting at $15 per month.

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Wall Street analysts on average expect that will all to translate to $1.40 per share in profits on $102.76 billion in sales, according to surveys published by Yahoo Finance. That amounts to a 12% jump in profits and 16% leap in sales, compared with last year. And all this despite the crushing COVID-19 pandemic that's still ravaging communities around the world.

"Overall, a strong iPhone year appears likely," Bernstein analyst Toni Sacconaghi wrote in a message to investors last week. He added the iPhone 12 Pro is still back-ordered in most major markets except the US and France, despite launching back in October.

If Apple does report such strong sales, it'll likely be taken as a bellwether for the broader tech industry, whose companies have become even more powerful during the pandemic. 

Other companies that have made big gains over the past year include Amazon, which has seen "record demand" over the past year, and particularly during the holiday shopping season, as people switch to online shopping. Google, and its parent company Alphabet, as well have outperformed even Wall Street's rosy expectations as marketers spend big to get people's attention online. And Slack, the business collaboration app, was sold to software giant Salesforce for $28 billion, nearly twice its value before it went public in 2019.

People have rushed to buy new computers and subscribe to collaboration tools like Slack, Zoom and Microsoft's Teams in order to work and learn remotely. Most students are still attending classes over video chat. And despite the successful development of vaccines, daily life isn't expected to return to normal for as much as another year.

Smartphones too have become even more essential, as they've become the do-it-all device for work, life and entertainment. Analysts at industry watcher IDC expect smartphone shipments to jump 9% this year, thanks in part to new flagship features like 5G. 

Lower prices are also helping spur demand. While Apple's iPhones didn't drop in price last year, carriers such as AT&T, Verizon and T-Mobile offered steep discounts to push people to 5G. 

It helps that CNET reviewer Patrick Holland named the iPhone 12 among CNET's highest-rated phones of all time, a sentiment shared among many other tech reviewers. "5G support, a new striking design, improved cameras and four different models all add up to make the iPhone 12 an absolute unit," he wrote in his review.

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Apple released four iPhone 12 models last year, in addition to its cheaper iPhone SE.

Andrew Hoyle/CNET

Shinier Apple

Consumers snatching up a new iPhone means more opportunities for Apple to hook people with its music, TV, gaming and news services, which are all powered by its hardware.

Apple caught the tech world's attention with its computers too. The company announced a new line of computers powered by chips similar to its iPhones and iPads. The M1 chip, as Apple called it, was designed to offer more performance while using less battery life than the Intel chips that Mac computers have run on since 2006.

That's part of why many analysts say they expect all of Apple's businesses, including iPads, Macs and services, will grow. 

"Apple's portfolio was positioned better-than-ever heading into the recent holiday season," Monness Crespi Hardt analyst Brian White wrote.

What isn't so clear is how much each of Apple's businesses will grow, and particularly its services.

The company's $5 per month Apple TV Plus service hasn't attracted as much attention as the $7 per month Disney Plus service or $15 per month HBO Max. Both those subscription services, which launched in the past year or so, have drawn people in with new installments in popular brands. Disney's had The Mandalorian from its Star Wars brand and WandaVision from its Marvel division, both of which helped it attract more than 86 million so far, many more than any other new services. HBO meanwhile has leaned on corporate cousin Warner Bros., which released its new Wonder Woman 1984 film online on Dec. 25. 

Netflix, meanwhile, continues to reign as the biggest streaming service, with more than 200 million subscribers.

But even if Apple's services don't attract everyone's money, devices like the iPhone will still act as one of the primary ways people watch them.

"In our view, the iPhone 12 has been Apple's most successful product launch in the last 5 years," Morgan Stanley analyst Katy Huberty wrote.

We'll find out if that's true on Wednesday.

Next: Read our iPhone 12 review.

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Apple adds VolunteerMatch guides to Apple Maps ahead of MLK Day of Service – CNET

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Organizations have increasingly encouraged people to volunteer in honor of the civil rights icon's birthday.

Getty Images

Apple has teamed up with VolunteerMatch to help people find a new way to give back to their communities this Monday, which is a federal holiday to celebrate civil rights leader Martin Luther King Jr.'s birthday.

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The VolunteerMatch feature in Apple Maps.

Apple

The new feature is built into Apple's Maps program on its iPhones and iPads. Normally, when the map shows a city such as San Francisco, Chicago, Atlanta or New York City, users can swipe up from the search bar to find items curated by local newspapers and activity-guide companies, ranging from bike trails to lists of lesser-known restaurants and sights. Now it has guides listed by VolunteerMatch too.

"Be a force for kindness and healing for our communities, and give in ways that matter," the guide says, along with a list of volunteer organizations.

The move is the latest way Apple has worked to support community, education and social justice organizations over the past couple of years. 

CEO Tim Cook, who keeps photos of King in his office, announced earlier this week an array of investments in historical black colleges and universities, app development centers and investments in racial justice organizations. As part of that announcement, Apple also donated to The King Center in Atlanta, which acts as a memorial for King. In the past, the company has donated to other civil rights nonprofits, including the Birmingham Civil Rights Institute and the Equal Justice Initiative in Montgomery, Alabama.

In the past, Apple has dedicated its home page, one of the most popular destinations on the internet, to King. And when Congressman John Lewis died last summer, Apple changed its home page to honor his civil rights leadership, too.

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