back
309 comments
Kind of telling that

1, the iPhone outsells every other category by 5-7x ratio, and the Mac (which includes everything from Macbooks to Mac Minis to iMacs) barely sells more than the iPad.

2, Services (iCloud, apps, music, TV shows etc.) now bigger than every other category, except the iPhone, combined

Basically 76% of the sales are iPhones and Services

(millions)

iPhone $209,586

Mac $33,708

iPad $28,023

Wearables, Home and Accessories $35,686

Services $109,158

Total $416,161

Next 5 years or so (or even less) both the iPad and the Wearables, Home and Accessories category will overtake the sales of Macs.

I really don't get how people do research work (like finding good flight tickets, or comparing hotels to stay in for a trip) without a computer. I really cannot stand seeing websites in a small screen without the ability to quickly open 4 browser windows with 4 tabs each for different combinations of dates, for example.
> Next 5 years or so (or even less) both the iPad and the Wearables, Home and Accessories category will overtake the sales of Macs.

Are we reading the same quarterly report?

Wearables/Home/Accessories is slightly higher than the Mac, yes, but its a category that has been trending poorly for Apple for ~18 months now IIRC, and that hasn't gotten better this quarter (9.04B->9.01B 3mo YoY). There's no foreseeable future where Vision starts driving Mac-like revenue (meaning, it'll be at least 2 years). Airpods are huge mainstays but have really hit market capacity and aren't growing. Apple Watch will see strong growth if they can successfully get glucose monitoring working, but that's an *if, and until then its slipping from an "upgrade every 3 years" to even longer lifecycle for most people.

Meanwhile: Mac is their fastest growing hardware segment by revenue (+12% 3mo YoY) (iPhone is +6%, iPad is flat, Services +15%).

iPhone aint going anywhere, Services are carrying their growth, but Mac is very solidly the #3 darling of this report. Their other product lines (Apple Watch, iPad, Airpods, etc) are interesting, successful businesses, but its unlikely we're going to see much growth out of them over the next 2 years. The story is iPhone, Services, and Mac, in that order, and there's no #4.

> Services (iCloud, apps, music, TV shows etc.) now bigger than every other category, except the iPhone, combined

This is reputation laundering. 'Services revenue' is undoubtably App Store game microtransactions, bigger than all other services categories combined.

Seems like the obvious reason for this is that Mac is now a niche for people that operate computers, where there are likely 6 people that don't for every 1 that does. We keep hearing that the next generation is "true computer" illiterate.

The second reason is likely that there are computers that are 1/3 of the price subsidized by the terrible ad-supported OS installs. (Has anyone tried to setup a MS computer lately, it's an ad-box).

Revenue growth is more interesting than raw revenue: iPhone up 6% YoY, Mac up 13%, iPad flat, Wearables, Home, and Accessories flat.

So Mac is doing very well!

> Next 5 years or so (or even less) both the iPad and the Wearables, Home and Accessories category will overtake the sales of Macs.

I view this the exact opposite way. The death of the laptop in favor of tablets has been touted for about a decade now, and it has still failed to materialize. Wearables have even surpassed the iPad.

Not to mention, the Mac laptops have seen a recent surge of popularity last few years, due to still being the only realistic ARM-based laptop, with the battery life / weight vs performance you get from this. This is still likely to remain the reality for at least a few years, and thus they're likely to snowball even more based on this reputation.

Around a decade ago, even as they were just launching Apple Pay, Apple was trading at a multiple barely over 10x. Street was valuing Apple like a manufacturing OEM company. I remember buying a small chunck of shares at the time thinking, this is crazy, just the services revenue off of owning these platforms is going to become massive one day.
These are the wrong numbers. You posted the 2024 numbers, not the 2025 numbers.

2025: iPhone $209.586 billion, Mac $33.708 billion, iPad $28.023 billion, Wearables, Home and Accessories $35.686 billion, Services $109.158 billion, Total $416.161 billion

Great, Apple is probably going to force more ads onto all of its platforms to drive service growth.

In ancient times Apple prided itself on not polluting its platforms with intrusive advertisements, but the line has been crossed and going back seems unlikely at this point.

If anything, they're the iPhone company and they are massively understating how much of their revenue is directly attributable to the iPhone.

Take "Services" for example: most of their services are things like App Store revenue and Google Search revenue, something they technically have on all of their platforms, but the lion's share of that revenue comes directly from iPhone users subscribed to iPhone apps, playing iPhone gacha games or using Google (or any of the other officially supported search engines) in the iPhone version of Safari. The reason to have iCloud+ is to be able to backup your phone, and the photos you take on your phone, and store the emails and iMessages and other data you create on your phone. It's all there accessible on the Mac and iPad too, but they have far more iPhone customers than Mac or iPad customers.

Even the smaller services are mostly supported by iPhone users: most AppleCare users, Apple Music, Apple Arcade, Apple News+, arguably you could make a case that Apple TV+ (a.k.a. just Apple TV now for some reason) is the one service that isn't directly attributable to the iPhone, but that is also like the one part of their services division that has had prior reports that it isn't exactly turning a profit, and I don't think you can even apply for an Apple Card unless you own an iPhone.

It's the same with most of the other divisions: the reason to have an Apple Watch or AirPods is they go great with your iPhone. They have their individual appeal, and at least with the AirPods, you don't technically need an iPhone to use them, but these are at the end of the day iPhone accessories, the same as their Magic Keyboard, Trackpad and Mouse lines or displays are Mac accessories even though technically, any iPad could also take advantage of them now, or you could plug a Magic Keyboard into a Windows PC or something. The math on that doesn't change just because of technicalities like that.

So yeah, Apple is the iPhone company and has been for a very long time now. Macs & iPads, the tens of billions of dollar businesses that they are, are just side gigs for them and Services/Wearables et al. is just obfuscating the degree to which they are the iPhone company.

If they ever stopped making Macs guess I'd start using Linux other than just for servers.
In terms of unit sales, Apple sells roughly double the number of iPads over Macs.

If the rumors about a cheaper entry-level MacBook are true, that might put a small dent into that, though I wouldn’t hold my breath.

Eddy Cue was tasked, over a decade ago?, with getting out front with services. Microsoft was doing it. And no one wants to have all their eggs in the iPhone basket.

Congrats to Eddy Cue then?

I've been using my 16" MacBook Pro with M2 Max and 32 GB of RAM, 1 TB of SSD, for more than 2 years and I feel or see no reason to upgrade.

At least not until there's an external design refresh. But maybe I'll get the M5 Max just for the heck of it.

Mostly because it'd be a pain to move all the data and state (the Time Machine or Mac-to-Mac transfer is not always perfect and hands-free in my experience)

They're just too good for their own good.

Their computers don’t need to be replaced often so that makes total sense to me. Both of my m1 series Macs will be more than adequate for my web dev needs for the next few years or at least until Apple force deprecates them.
Kind of funny they don't separate out accessories as its own category. If I were to guess it's because they don't want to advertise how much they make selling dongles.
It is also clearly why Apple wants to control all e-commerce and is fighting tooth and nail to keep controt
I get that the phones outsell the Macs but just wild Ipads almost match Macs.
i'd love to know how much of that "services" revenue is just iCloud storage for storing iPhone backups.
Any data on the Vision Pro?
Personal take :

The iPhone and services that go with the iPhone (music apps iCloud) together make apple what it is even today. The numbers are huge and the iPhone 17 and 17 Pro are still the gold standard of smartphones. Everything else is probably secondary support hardware and software for the iPhone.

I plan on moving away from macOS (maybe Asahi on my old M1 Air but leaning towards Arch on framework) but every attempt to reconsider the iPhone for me has failed.

The biggest thing I see is how the iPhone helped fuel social media and in turn social media helped iPhone with sales. The phone is a social and secure device and the iPhone excels at that thanks to iCloud services and the ease with which you can manage the phone. Upgrading is so seamless, managing Photos with iCloud is a no-brainer. Everything about it screams social and it does it extremely well.

The personal computer vs Mac war is still ongoing but android vs iPhone war was over years ago. The iPhone won and there is not much anyone can do at this point to compete at that scale unless someone comes up with something truly extraordinary rather than just putting LLMs inside apps.

Won where?

Android has about 70% market share and there are countries where only rich people get to use iOS devices.

Other population layers also need phones and digital services.

> leaning towards Arch on framework

That's a wonderful idea.

> The personal computer vs Mac war is still ongoing but android vs iPhone war was over years ago.

I don't think Macs are even a consideration for most "hackers." You can't build you own machine, Linux support is limited, they just cater to a crowd that wants a polished experience and don't mind giving up their freedom for it.

As for the phone market, I think Apple's success mostly comes to a combination of clever marketing and phone users being on average even less technically-minded than desktop users. Add to that social pressure now the the iPhone is dominant. That being said you couldn't pay me to give up my Pixel running Graphene, a device that is completely immune to corporate spyware, forced "upgrades," sideloading restrictions and compliance with idiotic laws like client-side scanning (if it ever happens).

Declining Mac sales aren’t concerning because Macs are high quality. People can skip generations and use their M1s for years.
Thinking this through… I spent around $3500 and $4500 on my last two MBPs, but got 9 years of use out of each of them. That’s only $450/yr.

But where I used to get a new iPhone every other year, I’m now on the fourth year of my 13P and it still works great. That’s only $300/yr.

It’s interesting to think about.

Mac sales are up 12%, year over year. It's Apple's fastest growing hardware category. They're just going to be lower next month (year over year), due to the release cycles being different.
This stuck out like a sore thumb to me:

Q4 2024: Income before provision for income taxes $29.610 billion, Provision for income taxes $14.874 billion

Q4 2025: Income before provision for income taxes $32.804 billion, Provision for income taxes $5.338 billion

[EDIT:] The 2024 taxes were actually an aberration.

"the one-time charge recognized during the fourth quarter of 2024 related to the impact of the reversal of the European General Court’s State Aid decision" https://www.apple.com/newsroom/2024/10/apple-reports-fourth-...

Corporate income tax is one of those ideas that are immensely popular politically ("someone who is not me will pay billions to benefit me? yay!") but not supported by economic theory or real economic outcomes. Rent control / other price controls is another one ("No more rent increases for me, yay!").

Personal income taxes are a better choice according to [0] and that makes sense if you think about it. Let companies go wild creating wealth; eventually the company matures, growth slows, and instead of reinvesting, the money mostly gets paid out to employees and owners as salaries, dividends, or stock buybacks. That's the point where it's most efficient to tax it.

[0] https://www.economicsobservatory.com/which-taxes-are-best-an...

[1] https://taxfoundation.org/taxedu/primers/primer-not-all-taxe...

Their 2025 US taxes are actually higher. In Q4 2024 "Apple paid a one-time income tax charge of $10.2 billion in order to resolve the tax issue with Ireland, which dates to 2016."

https://finance.yahoo.com/news/apple-profit-drops-36-tech-20...

Actually it was a huge tax addition in 2024 (from Europe over dispute about how Ireland had taxed Apple for many years). In 2024 Apple added 14.4 billion in additional taxes accrued over many years.
Are different sources of income taxed differently? Could it partly be from some change in income sources? Seems Services is more significant this quarter.
Enough to pay for everything DOGE and the Trump admin cut in 2025, assuming a big chunk of that is US taxes.
All these companies depend on TSMC for their life.
And TSMC depends on machines by ASML they can also sell to others.

And ASML licensed the technology from EUV LLC.

Which was a conglomerate of a bunch of state-funded US research labs.

And the US cut its science funding.

Misery all the way down!

If true, TSMC would command much higher margins. Their net revenue is a fraction of Nvidia or Apple
I mean... do they? TSMC is the best but in a world where they had to use Samsung or Intel is it really a death sentence?
Had to look up what TSMC meant (Taiwan Semiconductor Manufacturing Company).

What would Apple's next best option be if a war rendered TSMC unavailable?

Why is AAPL still one stock?
Interesting that Google and Apple matched their quarterly earnings in revenue .
How come they don’t add AI?
No wonder they treat the Mac like a third-class citizen. Mac sales barely pay their tax bill.
Apple could substantially eat into Nvidia’s AI lunch if they really tried, honestly Macs are fast enough… my guess is by the time M6 is coming out they will have external GPUs available for both the data centre and home use. If I was them I’d already be taking orders, power requirements alone even if they aren’t as fast 2 nodes ahead would make their offering sensational.