Tim Cook’s mission to make Apple’s service business huge is in itself very rewarding. The latest Wall Street estimate predicts its total value at a whopping $ 1.5 trillion – more than a third of Apple’s total market capitalization.
To put that figure into perspective, it is more than the national net worth of most countries – including Ukraine, Hungary, Peru and Qatar combined.
Apple services are becoming gangbusters
In early 2017, Cook said that Apple’s goal is to double the size of its service business in the next four years. At the time, Services had just earned a total of $ 24.3 billion in revenue for 2016. Today, that’s a whole other story.
From year to year, that number increased quite significantly, and in 2021, Apple’s service business attracted a whopping $ 68.4 billion. Wedbush analyst Dan Ives now sees services as a $ 1.5 trillion deal per se.
“Apple is fast to become the first company with a market capitalization of $ 3 trillion in 2022,” Ives said in a report for investors. “Achieving $ 3 trillion will be another turning point for Apple as the company continues to prove those who suspect it wrong with the renaissance growth story unfolding in Cupertino.”
“The key to re-evaluating Apple remains its $ 1.5 trillion service business, which we believe is worth it in the eyes of the streets.”
Putting $ 1.5 trillion into perspective
That figure in itself is more than impressive. But that is even more astonishing when you consider that only 36 countries – out of 174 – are currently worth more than that, according to Credit Suisse.
Apple’s service business is also significantly more valuable than companies such as Tesla, Meta (Facebook owner), Nvidia, Berkshire Hathaway and Apple’s chipmaker TSMC. In fact, it’s worth almost as much as Amazon. All by itself.
It can be said with certainty that services are another in a long series of victories for Cook since he became Apple’s CEO in 2011, when the company’s market capitalization was 348 billion dollars. It now stands at $ 2.9 trillion, making Apple the most valuable company in the world.
Via: Philip Elmer-DeWitt
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