Apple

The secrets to Apple’s $1 trillion success

Learn more about how Apple makes its money from the infographic below.

by
Chris Smith
February 14, 2020

Image: Unsplash

Apple is a powerhouse when it comes to consumer electronics, but it sells far more than just devices. In 2018. Apple became the first publicly-traded company in America to become worth more than $1 trillion, but how did it get there?

Apple is worth more than 1% of the world’s GDP, and it dominates the tech market within the United States. 41% of all smartphones, 38% of all tablets, and 46% of all smartwatches sold in the U.S. are made by Apple. But Apple also provides services for these devices at an additional cost, which provides Apple with a significant stream of sustained revenue long after you buy the latest iPhone. Apple sales are broken down this way:

$167 billion in yearly iPhone sales
$25 billion in yearly Mac sales
$19 billion in yearly iPad sales
$37 billion in yearly subscription services

Apple’s yearly net sales are $266 billion, while operating costs are $164 billion, leaving an annual gross margin of $102 billion.

The services Apple sells that maintain a steady stream of revenue include Apple Music, Apple Pay, iCloud, Apple News, Apple Arcade, Apple TV+, and Apple Care+. Apple’s philosophies of quality and service are one of the main reasons this brand has such staying power. Steve Jobs believed that the design aesthetic should be carried all the way through every device, that quality is more important than quantity, and innovation distinguishes companies as leaders rather than followers.

Learn more about how Apple makes its money from the infographic below.