Apple Inc. (NASDAQ:AAPL) is 40!

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Apple Inc. (NASDAQ:AAPL) recently turned 40, marking another milestone in its long and winding history. How has it been for the company for the last 40 years? What does the future hold for the company as it transitions into middle age?

While Apple’s Apple computers and iPod helped put the company in the limelight, it was the iPhone that completely changed the course of its business. Looking at Apple’s revenue and profit progress chart from 1976, you clearly see that the company’s financial performance figures took a turn for the better with the advent of iPhone.

For example, when Apple Inc. (NASDAQ:AAPL) launched the introductory iPhone in 2007, its annual revenue was only about $24 billion. But fast-forward to 2015, the company’s annual revenue stood at $234 billion. There is no doubt that iPhone has been a major cash cow for Apple.

However, the huge revenue contribution from the iPhone also poses some risks. How will Apple Inc. (NASDAQ:AAPL) keep improving its topline and bottom-line numbers when smartphone sales have recently seemed to be cooling? The iPhone accounts for nearly 70% of Apple’s consolidated revenue and it remains the company’s most important product.

Apple’s supply chain

Recent risks from Apple Inc. (NASDAQ:AAPL)’s supply chain showed that the company could be facing prolonged challenges in the iPhone market. It emerged that Apple’s components orders for 2Q2016 are lower than in the same period a year ago and slightly better than 1Q2016. The management had warned that 1Q2016 would be a slow quarter because of unfavorable factors in the iPhone market. But it seems that slowdown is spilling into 2Q206 and nobody knows whether 3Q2016 will also catch the cold.

New products

As smartphone sales cool because of increased competition and market saturation, analysts have consistently pointed out that Apple Inc. (NASDAQ:AAPL)’s future lies in new products. The wearable market is a promising one but revenue from Apple’s Apple Watch remains only a tiny fraction of the total according to various estimates.

Apple Inc. (NASDAQ:AAPL) has kept electric car project codenamed Project Titan a top secret. But analysts believe that expansion into car market could help fuel Apple’s next phase of growth.

Neha Gupta

Neha Gupta has been in the financial space for over six years now. Gupta earned her MBA degree from Symbiosis Centre of Distance Learning in 2009 and her passion for finance led her to pursue Chartered Financial Analyst (CFA) course. She has successfully completed Level II of her CFA. She is a veteran in article writing, which is depicted in her numerous pieces published on SeekingAlpha, Nextiphonenews, InsiderMonkey, MarketWatch, and Techinsider. Her crisp and eloquent writing finds its best place in Researchcows, where emphasis is given on developing rich content for various websites, products, business plans, trainings, and book writing.

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