Quarter after quarter, Apple (Nasdaq:AAPL) has managed to outperform both earnings and expectations. This success has primarily been a function of its four major product lines: its computers, tablets, iPods and iPhones. The firm’s iPhone is especially important to the company’s profitability, contributing an estimated near two-thirds of Apple’s profits.
As a result, Apple’s reliance on the iPhone as a profit-driver is far more extensive than most people are aware of.
On Jan. 9, 2007, Steve Jobs presented the first iPhone to the world. A computer, camera and iPod all in one, the iPhone 2G utterly shocked the world. At first, the market was torn between two camps: those who claimed that the iPhone would be a smashing success and those who maintained that the iPhone had fundamental issues that would hamper it from meeting its sales targets. Of course, it revolutionized the phone industry and helped Apple shatter its earnings estimates.
The iPhone 3G, or the second iPhone, was introduced on June 9, 2008, to even more fanfare. The new iPhone allowed third parties to create and sell mobile applications through the App Store, an important development that led to increased market share and profitability. In fact, Apple sold over 1 million iPhone 3Gs in the first three days of its release, a much faster pace than the iPhone 2G. Later, the iPhone 3GS was released, with minor system upgrades. Again, Apple had achieved massive success with its cellular product line.
Apple’s inventory of the iPhone 5 is improving with ship times jumping from one week to two to four days. These shortened delivery estimates were first spotted in Apple’s Australia and New Zealand stores.