Another example of what serves as business analysis these days from Andy Serwer:
Conventional wisdom says Apple is now at a crossroads. The company is so reliant on the iPhone—on track to sell some 231 million units this year, generating roughly 63% of its revenue and likely even more of its profit—that it has become vulnerable.
Some analysts predict iPhone sales will drop in 2016 (a first), but predicting gloom and doom for Apple is an annual event.
All Apple needs to do is: A) Keep iPhone sales up, and/or B) Find other sources of revenue. Both will be tough. Growing phone sales by 10% for instance—or 23 million units—is more than all the phones the company sold in 2009. And consumers seem to have been holding back from upgrading older iPhones, (though you could see that as an opportunity). Sales in China doubled recently, and the company continues to rely on that huge albeit now slower-growing economy. While Apple has upside to the iPhone 6, at some point soon it will need to add significant new features or some kind of new phone.
How does Apple make money?
iPhone, Mac, iPad, Watch, Apple TV, iTunes Music, Apps, Stores. Apple is a huge profit machine that continues to grow steadily, even though revenue and profits are outrageously high relative to competitors.
What most analysts and critics forget is that Apple itself, and hence the entire product line, are aspirational products; gadgets that people migrate up to. Traditional Windows PCs are passé, yet Macs continue to sell in record numbers because a growing number of customers are willing to pay more for higher quality. The same effect is beginning to be displayed in smartphones as customers migrate from cheap plastic knockoffs running Android, to Apple’s premium iPhone.