Origins
Apple was founded in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne. Wayne left within weeks. The company's early personal computers, the Apple I and Apple II, were followed by the Macintosh in 1984. The iPod, the iPhone in 2007 and the iPad in 2010 turned it from a computer maker into a consumer electronics company. In 2007 it dropped "Computer" from its name.
How the business makes money
Apple's model is product sales first, recurring revenue second:
- Devices. iPhone has long been the largest product line, with Mac, iPad and wearables alongside it.
- Services. App Store commissions, iCloud storage, media subscriptions, AppleCare and payment services. Services usually carry a higher gross margin than hardware.
- Installed base. Apple often talks about the number of active devices because services revenue depends on how many people own them.
How the hardware gets made
Apple designs its devices and many of its chips, including the A-series chips in iPhones and the M-series chips in Macs. It does not run large-scale chip fabs or most final assembly itself. Chips are manufactured by foundry partners, and devices are assembled by contract manufacturers. That is the fabless model described on our chips page, applied to a whole product.
What protects it
- Ecosystem. Phones, computers, watches and earbuds work best together, and shared accounts and data make switching harder.
- Brand and retail. Apple controls how its products are presented, including through its own stores.
- Vertical integration. Designing chips, hardware and operating systems together lets it tune performance and battery life.
What to watch in its reports
Apple reports revenue by product category and by geographic region. Look at how services grow compared with devices, and how much each region contributes. The risk factors section explains its reliance on outside manufacturers and on rules governing app stores in different countries.
This page explains how a company is organised. It is not investment advice and says nothing about whether a share is worth buying or selling.