What Are The Key Drivers Of Apple's Revenues?
Key Driver 1: iPhoneiPhone is the biggest driver of Apple's revenues, accounting for ~63% of total revenue in FY'18. Sales rose from $137 billion in FY'16 to $167 billion in FY'19, driven by higher pricing on flagship devices. We expect iPhone revenues to decline to $140 billion in FY'20, due to weaker shipments.
Key Driver 2: ServicesServices are the second largest (and fastest growing) driver of Apple's revenues (14% in FY'18)Services revenues grew from $24 billion in FY'16 to $37 billion in FY'18 driven by higher App and subscription revenues. We expect revenues to rise to over $50 billion by FY'20.
Key Driver 3: MacThe Mac accounted for over 9% of revenues in FY'18. We expect growth to remain slow going forward due to a saturated PC market.
Key Driver 4: iPadiPad accounted for about 7% of revenues in FY'18.We expect iPad revenues to improve, driven by new model launches and upgraded software.
Key Driver 5: Other ProductsApple's other products include the Apple Watch, audio products, and other accessories.We expect sales to grow to about $23 billion by FY'20.