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Where will Apple’s next round of services growth come from?
For nearly a decade, Apple has been progressively growing the revenue it makes from services—not just its search-engine deal with Google and its cut of App Store revenue, but everything from AppleCare support plans to iCloud storage to TV+ and News+ and Fitness+. Apple generated more revenue during its last quarter from Services than from its Mac, iPhone, and Wearables categories put together. Its total profit on Services came the closest it’s ever come to Apple’s total profit on products.
Even if recent U.S. court rulings threaten the quarter of Services revenue that comes directly from Google, there’s still an enormous and growing part of Apple that is dedicated to selling us services to go with our iPhones, iPads, and Macs. It’s a huge growth driver, which makes Wall Street happy. But what does the future hold for Apple’s services?