Apple has reduced its dependence on the iPhone (Topic)

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Apple has reduced its dependence on the iPhone


Apple has released another financial report, according to which iPhone sales now account for a smaller share of the company's total revenue. Thus, the corporation has become less dependent on the successful implementation of branded smartphones. At the same time, the company's income has slightly increased in comparison with the financial results of the same last year. This happened thanks to the sale of accessories and the promotion of Apple services.

iPhone is no longer a priority

Apple admitted that the sale of iPhones globally fell sharply, so their share in the company's total revenue declined. So, in its financial results for the 3rd quarter of fiscal 2019 (as of the end of June), the corporation reported that the share of revenue from iPhone sales in total revenue was less than 50% for the reporting period. This happened for the first time in the past seven years.

Compared to the same fiscal quarter of last year, the corporation's revenues actually did not change, although slightly, but grew (by 1%). As a result, the quarterly revenue of 2019 was at $ 53.8 billion. Nevertheless, Apple itself considers this quarter to be the best June period for the entire existence of the company.

For the third financial quarter of 2019, the sale of branded smartphones brought the company $ 25.99 billion. A year earlier in the same period, this figure was $ 29.47 billion, that is, 12% fewer buyers agreed to buy an iPhone this year than in the past. Experts say the main reason for this is the uninteresting iPhone lineup of 2018, which lacked any significant innovations. At the same time, the "apple" smartphones continued to keep the cost at a level higher than almost all other Android analogues. iPhone 2018 almost immediately after the official release failed sales, as a result of which the corporation was forced to reduce the volume of their production, which led to a decrease in profits.

What else did Apple make money with

While users are thinking about buying an iPhone or making a choice in the direction of another mobile gadget, Apple is trying to increase its income from other sources. Among them are various branded services, which brought the company this year $ 11.45 billion against last year's $ 10.17 billion. Over the year, growth was noted among the sales of accessories. In monetary terms, it amounted to $ 5.52 billion (last year this figure remained at around 3.7 billion).

Interestingly, against the backdrop of a large-scale global fall in the tablet market, Apple managed to increase its own income from iPad sales over the year. In 2019, revenue for them amounted to $ 5.023 billion, which is more than last year's figure (4.63 billion). The reason for this was the global update of the iPad family this year.

Plans for 2019

Apple intends to continue to bet on the development of branded services, planning to get even more profit from them. So, the company will soon launch its own television service Apple TV + - an analogue and possible competitor of Netflix. The company is also working on the Apple Arcade game project. The launch of new products is expected in the fall. Earlier, in August, the company planned to launch the Apple Card branded credit card.

The next line of iPhone is also expected to be released in the fall, although in the professional environment it is not considered a global achievement of the corporation. According to leaks and other inside information, Apple's 2019 smartphones will be the next interpretation of the iPhone X, while large-scale changes should be expected only in the 2020 iPhone family, which, in particular, will be able to support the modern 5G communication standard.

According to Apple's plans, all of its actions should bring the company to $ 64 billion in revenue in the next fiscal quarter, but the corporation does not report what share of its iPhone sales will be.

The Topic of Article: Apple has reduced its dependence on the iPhone.
Author: Jake Pinkman