~25% of Apple's revenue came from services in FY25 (and 50% from iPhone, ~25% from other hardware). They made $415B in that year, so ~$100B from services alone!
Services revenue is mostly just 30% from App Store Sales. This means every time a user clicks a pro account for ChatGPT or Claude on their phone, Apple makes more money than they could make with a self deployed model.
You're not wrong that they collect a ton of rent off AI apps, rumours a few weeks back claimed $900m in fees last year with 75% of that just from OpenAI.
But services revenue is:
- their 36% share of Google Ads for being default search engine, about $21 billion/year of pure profit
- their IAP fees, court testimony reveals 75% profit margin
- their first-party subscriptions, there's an antitrust about iCloud that alleges 52% of iPhone users are on paid plans and that the profit margins are 80-ish percent!
I still have friends who work there. Some of them came to Apple from Be or Eazel, and are still working on Finder, Safari, Dock, etc. A lot has changed and in my opinion not for the best. Compared to them, my time there was a flash in the pan. When I look at Safari, Finder and the general state of the UI, I am deeply saddened. I see a bizarre combination of stagnancy, gratuitious change and general aimlessness across the desktop and mobile. I also have a deep distrust of anyone who works at big company, let alone a big company on one component for a long amount of time. To me, it leads to a focus away from external customers and to becoming an expert at internal politics. I probably need counseling, but I loved the dictatorship of the Steve era. Yes, we can point to flaws like the Mac Cube or the hockey puck mouse, but I really appreciated someone just maniacally fixated on getting things done and cutting through the BS that I saw later on in jobs in big tech.
It would be nice if veterans of the post-Steve era would post on here. Maybe they are scared, bound by NDAs or could care less. Like I said, I need some mental health treatment about my time(s) at Apple I was there working on Final Cut Pro after Be, went to Eazel, and then rejoined Apple as part of Steve's mass hiring of Eazel employees at the behest of Andy Hertzfeld.
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