Apple has achieved a groundbreaking success in the technology world by announcing a record annual revenue of $100 billion from its services division, without selling physical products. This figure represents the company’s second-largest revenue stream after iPhone sales and indicates a scale that would surpass many giants in the Fortune 500 list.
The services division, which generated $25 billion in revenue in the last quarter with a 12% year-over-year growth, was described as a “significant milestone” by CFO Luca Maestri. This success story has evolved from a $4.8 billion revenue level in 2014 to today’s $25 billion, catching Wall Street’s attention.
The services unit maintains an impressive 74% gross profit margin, significantly higher than the company’s overall margin of 46.2%. This division comprises various revenue streams including advertising, Google search agreements, AppleCare warranties, iCloud services, Apple TV+ subscriptions, and Apple Pay.
Under Tim Cook’s leadership, Apple aims to continuously expand its service ecosystem, boasting 2.2 billion active devices and 1 billion paid subscriptions. The company has announced plans to add new features to services like Apple News+, Music, and Arcade.