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Apple Hits Record High As It Dumps Intel For In-House Chips on New Mac Computers

Apple will extend its reign as the world's most valuable tech company Tuesday as shares hit a fresh all-time high in the wake of its annual Worldwide Developers Conference in Cupertino, California.

Apple Inc.  (AAPL) - Get Apple Inc. Report shares hit a new all-time high Tuesday, taking its market value close to $1.6 trillion. as investors cheered the tech giant's move to cut tied with long-time supplier Intel Inc. INTC and move the design of chips for its new line of Mac computers in-house.

Apple CEO Tim Cook revealed the move during his keynote address to the company's annual Worldwide Developers Conference yesterday in Cupertino, California, calling it a game-changer for what is now the world's most valuable company.

Using set architecture from Britain's ARM Holdings, which was bought by Japan's Softbank for $31 billion in 2016, Apple can design its own chips in a way that will tie Mac computers more seamlessly to the company's more popular iPad, as well as its signature iPhone. It could also help the company control and expand future product releases, improving profit margins and potentially reducing its hardware division's reliance on iPhone sales. 

"At Apple, integrating hardware and software is fundamental to everything we do," Cook told the audience at the Apple Park campus Monday. "Silicon is at the heart of our hardware. Having a world-class silicon design team is a game-changer."

Apple shares were marked 2.1% higher in early trading Tuesday to change hands at $366.55 each, an all-time high and a move that would extend the stock's year-to-date gain to around 24.5% and value the group at around $1.585 trillion, just ahead of Microsoft's  (MSFT) - Get Microsoft Corporation Report $1.53 trillion.

Apple also unveiled a new operating system for iPhones, known as iOS14, that will give users more control over the look and feel of their smartphone homescreens while offering enhanced messaging and video options.

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Earlier Tuesday, UBS boosted its price target on the stock by $75, to $400 per share, citing what it estimates will be stronger-than-forecast June quarter iPhone sales of around 34 million units.

The bank also raised its current financial year iPhone shipment forecast by around 4%, to 218 million units, and sees a rebound in wearables demand heading into the second half of 2020.

The WWDC, the fist all-online version of the annual event in 30 years, also saw Apple cede to come criticism of its App Store business model, which has driven significant revenue growth while drawing the ire of developers and lawmakers alike.

Apple said it would allow App makers to 'challenge" is policy of demanding a 15% to 30% cut of the revenues generated by a third-party App on its platform, while also allowing users to chose non-Apple Apps as default settings on their individual iPhones.

Last week, EU regulators opened an antitrust investigation into both the company's App Store and Apple Pay units, with a focus on Apple's demand that developers use its in-App purchasing system to sell their products to customers. Developers are also balking at the company's demand to hand over nearly a third of any App's annual revenues.

House Democrat David Cicilline, who chairs a Congressional subcommittee on Antitrust issues, called Apple's App store demands 'highway robbery' during an interview on Bloomberg television last week and called on Cook, as well as other big tech bosses, to testify before U.S. lawmakers.