Say what you will about Apple’s product and their company culture. They can be closed (vs. Google’s “open”) and the company can be arrogant, but you have to admire how successful they are right now. Their domination of the consumer electronics industry is just staggering. Never before in my life have i seen a company firing on all cylinders like this. It truly something to witness.
Let me give you some facts from their latest earning’s call this week.
- The first astonishing statistic, is that Apple’s revenue grew 71% in the past year. Large companies like Apple’s just don’t grow 70% year over year. Apple is now on a revenue run-rate of more than $100 billion a year. Just as amazing, it is expecting to grow another 60%+ in the first quarter of this year.
All their products are crushing it.
The App ecosystem is now deployed across all products. Buying an app on Mac App Store goes to iPod and to iPhone. It’s all related and working nicely. Look at these stats:
- Mac sales grew 23% in a market that grew only 3%. This is 8x the market rate.
- iPods remain at 70% of the market
- iTunes is now a $4 billion dollar a year business with nobody even coming close. Users are now renting and purchasing over 400,000 TV episodes and over 150,000 movies per day.
- iPads already account for 7% of all PC’s shipped
- The retails stores are now a $16 billion a year business and revenue grew 95% last year.
- The Mac App Store just launched and sold 1 million apps the first day
The competition is nowhere. Google Android tablets have an OS (Honeycomb) which isn’t fully speced and hasn’t launched yet anywhere. That means as Apple rolls out v2 of the iPad which millions of apps, the closest competitor has yet to fully launch v1. The Android phone OS will definitely be the dominant player in the market. Every phone will use it because there are zero alternatives. But Google nor the handset makers won’t cash on its success anywhere close to how Apple’s cashing in on the iPhone. The iPhone supply can’t meet demand. It can’t meet demand so there’s no reason to think that Apple is scared of competition there.
Is Microsoft supposed to be king of Enterprise? iPhone and iPad have now penetrated the enterprise and taking names (over 80% penetration of Fortune 100). Where’s the competition?. If I was MS or RIM, i’d be very very worried.
This is before they’ve had any success integrating in all their latest acquisitions. These are Lala (subscription cloud-based music service), Quattro (mobile advertising), Siri (killer voice recognition), and Poly9 (maps and 3D). These, especially the Quattro, could open entire new markets for them although it remains to be seen how that plays out.
So, Apple is cruising and margins for the company as a whole is are almost 40% so while i can see others catch up (Google, Samsung), there’s no way they will actually challenge the freight-train that is Apple.