**You’re right about the immediate cash flow:** when one investor sells existing shares to another, the company ordinarily receives none of the money. A falling share price does not, by itself, drain the company’s bank account. That transaction happens in the [secondary market](https://www.investor.gov/introduction-investing/investing-basics/glossary/primary-and-secondary-markets).

The difference from your iPhone example is that **a share represents continuing ownership of the company**. The buyer becomes one of its owners, often with voting rights. So the buyer and seller are directly related to the company in that sense. [Investor.gov explains these ownership rights](https://www.investor.gov/introduction-investing/investing-basics/investment-products/stocks).

That gives the company several reasons to care:

- **Future fundraising.** A company may issue more shares later. Suppose it wants to raise $10 million. At $100 per share, it would need to issue roughly 100,000 shares; at $10, roughly one million. A higher price lets it raise the same money while giving up a smaller ownership percentage, assuming the same initial share count. These are illustrative figures.
- **Accountability to owners.** Shareholders care about their investment’s value. They can vote for directors, who oversee management. Persistent poor performance can therefore threaten management’s jobs. [Investor.gov describes shareholder voting](https://www.investor.gov/shareholder-voting).
- **Employee compensation.** Many companies pay employees partly through shares or stock options. A falling price can reduce that compensation’s value and make retaining employees harder. For example, [Nautilus Biotechnology’s June 2026 filing](https://www.sec.gov/Archives/edgar/data/1808805/000180880526000034/naut-20260630.htm) identifies this risk.
- **Acquisitions and control.** Companies can offer their own shares as payment when buying another business. Their price affects how many shares must be offered. Conversely, a lower price can make acquiring a controlling stake in the company cheaper, although voting arrangements and takeover rules also matter.

Your analogy works for the proceeds of the original sale: the company has already received that money. It breaks down because shareholders retain ownership rights, and the market price affects the company’s future financing and other decisions.

A company that can fund itself comfortably from profits may have little operational reason to worry about daily price fluctuations. Its owners still have reason to care about their investment’s long-term value.