After Apple’s stock market value tapped $1.4 trillion and its multiple trades at 10-year highs, investors will seek new proof that the tech company should be seen as a maker of high-margin subscription services. Apple’s stock has risen by two times over the past year despite the reduction of iPhone sales along with the worldwide market for smartphones, Reuters reported.
The high performance has been powered by Chief Executive Tim Cook’s efforts to make the customer base of Apple into a well of consistent services revenue, with the inclusion of a credit card rolled out last year in partnership with Goldman Sachs and streaming video. Apple is reportedly on the way to meet its aim to increase its 2016 services revenue by two times to $48.7 billion by the close of fiscal 2020 as it homes in on offering high-margin subscriptions to its customers.
Last year, Apple rolled out a video game service and a subscription news app, among other offerings. The tech company has also heightened its focus on its extended warranty program, AppleCare. The “settings” of the iPhone now encompass reminders that aim to have consumers purchase or renew their AppleCare plans.
Apple won over the Street with a 17 percent rise in revenue from its services vertical over the fiscal year that concluded in September. According to The Wall Street Journal, its accomplishment of increasing sales of apps, mobile payments and streaming music subscriptions provided many investors with the assurance that the firm discovered life aside from the iPhone.
In separate news, Apple recently unveiled its “Apple Watch Connected” gym effort with new fitness collaborations that make it easier for owners of Apple Watches to gain rewards, keep track of workouts and buy items. The effort helps Apple develop an entire ecosystem surrounding the smartwatch and providing owners with more places to use it to aid in the monitoring of fitness.