Why do you say the company has to grow?

At a least keep up with inflation in order to have future value?

I'm almost didn't write this because I didn't want to deal with the "why do we have to grow" responses.

If you are a single proprietorship then go nuts. Do what you want. If you take investor money you are an investment, and you are legally obligated (at top levels, via fiduciary obligations) to operate things to generate return. That's also why you have other corporate structures like B/public interest corps, mutuals, credit unions out there that don't obligate growth.

Apple has to grow because it's public Delaware C corp. Or they have to return cash so owners can invest it elsewhere. Or the owners will fire the executives, or shareholder groups might vote for takeovers that offer greater returns. I'm not defending it, but explaining it.

> Or the owners will fire the executives, or shareholder groups might vote for takeovers that offer greater returns.

It's worth emphasizing this point because it's a common misconception. Companies don't have a legal obligation to grow - they have a legal obligation to do what their investors want. But being publicly traded virtually gaurentees that your company is owned by people who want it grow or will be owned by people who want it to grow.

strictly speaking, a company doesn't have to grow (no, there's no law nor even fiduciary duty to grow), but it's certainly incentivized as such, because valuations are most sensitive to growth rate.

They have to provide a risk-weighted return similar to the current average stock, otherwise they should be revalued to the point at which they would provide that.

Perhaps it’s the P/E ratio in valuation. If a company isn’t growing the premium portion of its stock price reduces and the stock price drops.

TLDR; stock price includes a portion reflecting increased future growth

This is the real reason why CEOs are on a never-ending quest to grow even if it's detrimental. They are measured and compensated on share price. And share price is mostly driven by growth prospects. This is the real reason why Apple needs things like 3 camera lenses (just like Gillette needs 3 blades) and thin isn't thin enough. If you're a private company, you can do things like Hacker News and Craigslist where you don't change for the sake of change.

EDIT: to show the impact of growth prospects: Right now, Apple's P/E ratio is 20x with share price of $243. But in 2016, P/E was 11x with share price of $100. That is a 143% increase. If you look at revenues, 2019:$259B compared to 2016:$216B - which is only a 20% increase. Look at the article[0] from 2016, it says stuff like:

Apple shares are tanking this week because of a report in Japan's Nikkei newspaper that Apple plans to slash its output of iPhone 6S and iPhone 6S Plus by 30%.

That comes on the heels of an Accenture report warning that demand for smartphones is waning. People don't believe the newer models are all that much better than what they currently have, so they don't want to pay for an upgrade.

[0] https://money.cnn.com/2016/01/08/investing/apple-stock-100/i...