Apple Acquires Smaller Companies for ‘IP and Talent’

During the Q&A session, Tim Cook was also asked to talk about Apple’s strategy for acquiring other companies. It’s a topic that’s certainly at the forefront of many people’s minds these days, considering how massive Apple has gotten.

However, Cook noted that Apple isn’t generally interested in acquiring large companies for the sake of doing so. Instead, his focus is on looking for what kind of intellectual property (IP) and talent a company can bring to Apple, regardless of its size.

We are always looking at companies to buy. We acquire a lot of smaller companies, and we’ll continue to do that for IP and to incorporate talent. We don’t discount something larger if the opportunity presents itself. I’m not going to go through my list with you on this call, but we’re always looking.

That’s precisely what happened with Apple’s 2014 acquisition of Beats, which at $3 billion was the largest in the company’s history. Even though Apple still owns and markets the Beats brand of headphones, that turned out to be a side benefit. What Apple was really after was the expertise and industry connections of Dr. Dre and Jimmy Iovine, which directly led to the creation of Apple Music.