The 2nd Largest in the World
Apple is currently the 2nd largest company in the world, with a value of $2.6 trillion, surpassing Brazil’s GDP. With a revenue of $383 billion in 2023 and a profit of $95 billion, the company, which turns 50 in 2026, has revolutionized the way we live and now has over 2 billion active products worldwide.
50 Years at Full Throttle
The Apple Computer Company was founded in 1976 by Steve Jobs and Steve Wozniak in a garage in Palo Alto, California. They worked at Atari, a video game company, and each would have 45% of the new company. The remaining 10% would belong to Ronald Wayne, who soon sold his stake for $800, which today would be worth hundreds of billions.
The two Steves started with nothing, selling a van and an HP computer they had to assemble the Apple 1, sold for $666.66, as Steve Jobs liked repeating digits. But real success came with the Apple 2, which, with a monitor, keyboard, and mouse, set the future of computing.
Jobs was then 21 years old, and as the company’s revenue rose from $700,000 in 1977 to $117 million in 1980, so did his fortune: from zero in ’76 to $1 million in ’78, $10 million in ’79, and $100 million at age 25, when Apple went public in the final days of 1980, issuing 46 million shares at $22 each.
The Departure of the Founders
The shares have been split five times since the IPO (ticker AAPL), so adjusted for splits, the price per share was 10 cents. If you had invested a thousand dollars in Apple until 2003, when the stock was priced at 20 cents, you would have had 5,000 shares, which today would be worth $860,000, the best return on the American stock market from 2003 onwards. From there, the stock went from 20 cents to almost $200.
In the 1980s, the company went through several failed projects, such as the Apple Lisa, with a high price and limited variety of applications, leading to the departure of the founders: Steve Wozniak in ’83 and Steve Jobs in ’85.
Jobs then founded Next, whose operating system was later acquired by Apple for $430 million. When Jobs returned to Apple as CEO in 1997, the company was on the verge of bankruptcy, reversed in 1998 with the launch of the iMac, which sold over 800,000 units in five months.
The Return of the Revolution
In the 21st century, Apple’s performance was legendary. In 2001, the first Apple Stores were opened, the Mac OSX system was launched, and the iPod was announced, which would retire in 2014. In 2003, iTunes was launched, the first digital platform for music sales, which evolved into Apple Music and now holds a 13% market share, second only to Spotify’s 30%.
In 2006, Apple launched the MacBook, and the following year saw the most profitable launch in its history, the iPhone, revolutionizing the smartphone industry, with the App Store following soon after.
In 2010, they launched the iPad, the first tablet with the power of a computer, developed before the iPhone but launched later. With the passing of Steve Jobs in 2011, Tim Cook took over leadership and maintained Apple’s financial success, launching products such as the virtual assistant Siri in 2011, the Apple Watch in 2015, and the AirPods in 2016.
In 2012, Apple’s market value surpassed $400 billion, overtaking Exxon Mobil as the most valuable company on the American stock exchange. In 2018, making over $100,000 per minute in profit, Apple became the first company to be valued at $1 trillion, surpassing the combined value of the four largest American banks and establishing the new paradigm of Big Tech dominating the stock market, followed by Google and Microsoft.
The First Company to Reach $2 and $3 Trillion
Apple’s products are coveted from Guatemala to Zimbabwe, and a significant portion of its 1.5 billion active users would not trade it for any other brand. In 2020, it reaches a market value of $2 trillion, surpassing the Saudi oil company Aramco and becoming the world’s most valuable company.
In 2023, Apple becomes the first company to reach a $3 trillion valuation, a company that once had over $76 billion in cash, more than the U.S. government. Today, it has around $30 billion in cash, has been paying quarterly dividends since 2012, and is one of the biggest buyback players: it uses its cash to repurchase its own shares, boosting its earnings per share.
The World’s Most Profitable Company
While the iPhone remains Apple’s flagship product, its success has propelled the company to create a unique ecosystem spanning hardware, software, and services, contributing to revenue of $383 billion in 2023. Since the iPhone, new releases have diversified the company’s revenue sources: until 2007, Macs accounted for 43%, and iPods for 35%, totaling 78% of the revenue.
By 2015, the year of the iPhone 6, over 66% of the revenue came from the iPhone, and services reached their lowest level at 8.5%. However, since then, services have more than doubled, accounting for 22% of Apple’s revenue in 2023. Just over half of the revenue comes from the iPhone, totaling $200 billion per year; $85 billion from services like iCloud and AppleTV; $39 billion from accessories like Apple Watch and AirPods; $29 billion from Mac, and $28 billion from iPad.
To date, 2.3 billion Apple products have been sold, with 1.3 billion being iPhones. However, since 2018, the company has not disclosed units sold, only the revenue generated. Yet, through estimates and legal proceedings, it is known that there are 1.5 billion active users: one in every four people in the world is a customer of the company.
Apple also has 520 stores worldwide, with more than half in the United States. Instead of maintaining its own factories, Apple buys 98% of its materials from over 200 companies and assembles its products in China by the company Foxconn, which employs 1.4 million people. Apple itself has 160 thousand employees.
Chinese Boycott
The iPhone is a success story on every continent, with the majority of its revenue coming from the United States and Europe. In China, however, sales have declined since 2015, with local companies like Huawei increasing their market share. The red tide in China only turned in 2021 when iPhone sales began to grow again.
Competition from Big Tech
Among competitors, Apple faces smartphone manufacturers like Samsung and LG, computer makers like Lenovo and Dell, streaming services like Spotify and Netflix, as well as other Big Tech companies like Microsoft, Alphabet, and Amazon.
In gaming, for example, Apple made $9.5 billion by charging 30% of all sales on the App Store, leading to a lawsuit from Spotify, plus an additional $3.7 billion from other apps. This amounts to $2 billion more in gaming profits than what Microsoft, Nintendo, Sony, and Activision Blizzard have combined.
In 2004, Microsoft had a market capitalization 11 times larger than Apple’s, $291 billion compared to Apple’s $26 billion. By the end of the decade, Apple would reach $297 billion, surpassing its rival and demonstrating shareholders’ confidence in the company’s future.
Since then, Apple has often held the top position. In January 2024, Microsoft became the world’s most valuable company, $400 billion more than Apple, following a weak start to the year in iPhone sales in China and Microsoft’s demonstrated strength in AI advancements, having invested in OpenAI, the creator of ChatGPT.
One-Quarter of the Planet as Customers
Apple’s revenue growth has slowed in recent years, but when new iPhones are launched, it usually reacts positively, as long as customers see a real advancement compared to the previous generation. The Apple Car has been discontinued, and the company has transferred its employees from that sector to AI, where it has a significant advantage due to access to information from one-quarter of the planet’s inhabitants.
The services sector is expected to continue growing, and Apple should remain at the forefront in hardware such as smartphones and computers. Looking to the future, the bet is on the VisionPro, a wearable computer priced at $3,500 with direct eye projection. Let’s see if they’ll soon launch an injectable product as well, so fans can have Apple in their veins.
The World as We Know It
Apple is a company that has made history by inventing the computer and the cell phone as we know them today. It’s omnipresent in modern life, with one-quarter of the planet as its customers and the highest profit in the world, despite recently being surpassed by Microsoft in market value.
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