How Does Apple
Make So Much
Money?
$171 billion: How Did Apple Do It?
Apple made $171 billion
in revenue last fiscal
year.
There are 7 billion
people on Eart...
No. 1: iPhones
• Apple’s biggest revenue
driver and fastest growing
product over the last two
years was its iPhone.
• Over...
Apple’s Superstar Product
• Apple’s iPhone has been
growing as a percentage
of revenue, going from
42% to 53% in three
yea...
No. 2: iPads
• Apple’s second-largest
revenue driver was the
iPad.
• But growth’s been slowing
– it grew only 3% year over...
Slowing Growth
• After a high-
growth year, sales
are slowing.
• Even still, the iPad
provides roughly
20% of Apple’s
top ...
No. 3: Macs
• Rounding out the top
three is Apple’s Mac
line.
• Revenue has been flat
over the past two years;
growth’s be...
No. 4: iTunes, Software, and Services
• With a CAGR of 31%
over the last two years,
this is Apple’s second-
best performin...
No. 5: Accessories
• Apple’s accessories
segment will get a boost
from the recent Beats
acquisition.
• Look for growth to ...
No. 6: iPod
• Once a highflier, iPod
sales have cratered.
• On the heels of a 25%
drop in fiscal 2012, the
iPod dropped 21...
Leaked: Apple’s Next
Smart Device
(Warning, It May Shock
You)
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How Does Apple Make so Much Money?

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Ever wonder how Apple makes so much money? Here's how!

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Transcript of "How Does Apple Make so Much Money?"

  1. 1. How Does Apple Make So Much Money?
  2. 2. $171 billion: How Did Apple Do It? Apple made $171 billion in revenue last fiscal year. There are 7 billion people on Earth. So Apple made the equivalent of $24.50 per person. Here’s how Apple did it! Did you pay Apple $24.50 last year?
  3. 3. No. 1: iPhones • Apple’s biggest revenue driver and fastest growing product over the last two years was its iPhone. • Over half – 53.4% -- of Apple’s revenue was from its iPhone lineup. • Revenue from the iPhone was up 16% year over year and nearly 100% over two. Revenue: $92.3 billion
  4. 4. Apple’s Superstar Product • Apple’s iPhone has been growing as a percentage of revenue, going from 42% to 53% in three years. • That’s good, because according to multiple third-party sources, Apple’s iPhone is its highest-margin product Great growth and solid margins
  5. 5. No. 2: iPads • Apple’s second-largest revenue driver was the iPad. • But growth’s been slowing – it grew only 3% year over year versus 61% year-over- year growth in the previous fiscal year. Revenue: $32 billion
  6. 6. Slowing Growth • After a high- growth year, sales are slowing. • Even still, the iPad provides roughly 20% of Apple’s top line. Sluggish growth from Apple’s No. 2 product
  7. 7. No. 3: Macs • Rounding out the top three is Apple’s Mac line. • Revenue has been flat over the past two years; growth’s been hard to come by. • However, this is impressive in a down PC market. Revenue: $21.5 billion
  8. 8. No. 4: iTunes, Software, and Services • With a CAGR of 31% over the last two years, this is Apple’s second- best performing segment. • In addition to adding to Apple’s top line, this segment adds value by improving the user experience for other Apple products. Revenue: $16.1 billion
  9. 9. No. 5: Accessories • Apple’s accessories segment will get a boost from the recent Beats acquisition. • Look for growth to pick up from its two-year average of 13% per year. • It hasn’t kept up with Apple’s total revenue growth over that period, but it’s still better than… Revenue: $5.7 billion
  10. 10. No. 6: iPod • Once a highflier, iPod sales have cratered. • On the heels of a 25% drop in fiscal 2012, the iPod dropped 21% this year. • Many analysts have pointed to cannibalization from the higher-margin iPhone. Revenue: $4.4 billion
  11. 11. Leaked: Apple’s Next Smart Device (Warning, It May Shock You)
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