Apple May Be Looking to Restructure Its Business Model



Apple is reportedly planning to shift its revenue model

Apple (AAPL) has evolved several times over the decades to move with the times. The tech giant’s venture into smartphones about a decade back revolutionized the handsets space. Now, as its iPhone sales are shrinking, the company has been trying to ramp up its fast-growing Services segment. According to a recent report by the Wall Street Journal, Apple may soon move away from the iPhone as the core of its business.

Article continues below advertisement

Services are growing quickly but still make up a small portion of revenue

The Wall Street Journal points out that a good part of the company’s shift will be towards its Services unit. In the first quarter of 2019, which ended in December 2018, the Services segment generated revenue of $10.9 billion, a 19% YoY increase.

While this is a slowdown from previous quarters, the segment is still on course to generate $50 billion in 2020, which is the company’s goal. Soon, the company is expected to launch its own streaming service, which it has been working on for over a year.

After peaking at around $233.4 per share in October 2018 and crossing a market cap of a whopping $1.1 trillion, Apple’s stock slid by nearly 40%. The company has since rallied over 20% and briefly reclaimed its top position as the most valuable public company in the world. The stock is up 9% year-to-date.


More From Market Realist