iPhones are both popular and expensive, so it makes sense that Apple is raking in the dough. But equipment sales only account for a portion of Apple’s overall revenue and how Apple makes its money. Once you buy that iPhone or Apple Watch or iPad, chances are you are also signing up for services, and those services add a whopping $37 billion a year to Apple’s revenue streams. Apple was the first publicly traded company in the United States to become worth $1 trillion, but how did it get there?
While Apple was the first, other major tech companies in the U.S. are catching up. Currently, Apple is worth $1.41 trillion, and Microsoft is catching up quickly with a market value of $1.39 trillion. Alphabet, the company that owns Google, is worth $997.2 billion, and Amazon is worth $1.03 trillion.
Apple is a clear leader in device sales within the United States. 41% of all smartphones, 38% of all tablets, and 46% of all smartwatches are Apple products. Annually, iPhones sell $167 billion worth, Macs $25 billion, iPads $19 billion, and services $37 billion. This adds up to $266 billion in net sales, and after the $164 billion in operating costs is covered that leaves Apple with a yearly profit of $102 billion.
Part of Apple’s secret to success lies within the philosophy Steve Jobs left behind. Jobs believed in quality over quantity, that the design aesthetic should be carried all the way through, and that leadership and innovation would set Apple’s products apart from the rest.
Because of the quality of Apple products, they have the ability to last longer than most other products on the market, and subsequently, they have a higher resale value than other similar products on the market.
Learn more about how Apple makes its money from the infographic below.
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