The iPhone, Mac Book, iPad and iPod-there is no denying that Apple successfully creates and sells some pretty amazing technology. In fact, Apple has been deemed the biggest financial bull run of any technology company in history. You just have to look at the numbers to see that; the company grew from $13.931 billion in revenue in 2005 to $170.910 billion in 2013. The tech giant stole its title as one of the best by securing revenue growth year after year. In January, Apple CFO Peter Oppenheimer predicted that Apple will generate the same amount of revenue this past quarter as it did last year and most analysts agreed. Apple did successfully generate more revenue than ever during the first fiscal quarter of 2014, but many believe that the remainder of the 2014 fiscal year may not bring the same growth that the company is accustomed to. This could possibly be the first year since Steve Jobs returned to Apple and turned the company around that revenue will not grow from one fiscal year to the next.
What’s the reason for the lack of growth? IPhone sales, which represent 56% of Apple’s revenue, would be the first place to look for that answer. Moving forward sales are expected to be flat and stay relatively level. On the other hand, Apple’s iPad doesn’t have the same success story or foothold as its cousin, the iPhone. While the phone industry allows the iPhone to sell at an average cost of $637 each and be re-purchased by consumers every two years or so, the iPad has not found the same success in growth opportunity. The iPad is the most recent device Apple invented, spawning an entire category of devices and dozens of copycats, however they are steadily being labeled as something we can do without. Smartphones have edged out the necessity for a Tablet and many other devices. Those that do feel the need to own an iPad are not replacing them as frequently as you would a lost, stolen or broken iPhone. In addition to the stability of the iPhone and lack of growth in iPad profits, consumers are realizing that they can end up purchasing more affordable alternatives. If you want to watch a HD movie on a tablet, and two products offer the same experience, why do so on one with the Apple pricetag?
Though it is anticipated that Apple will not see growth, we can’t count the innovative tech giant out just yet. Rumored launches for later this year include a larger iPad and iPhone, as well as the iWatch which may provide incremental growth in revenue. It might not rake in the massive revenue that they are used to, but it’s still enough to build on top of its current base.