Apple at 50: How Devices and Services Grew Together

Why I Keep Coming Back to Apple

April 1, 2026 marks Apple’s 50th birthday.

On April 1, 1976, Steve Jobs, Steve Wozniak, and Ronald Wayne founded Apple. Ahead of the 50th anniversary, Tim Cook looked back on what people have done with Apple’s products in a public letter.

I’m both a longtime Apple user and a shareholder. For this anniversary, I looked at how much revenue has grown and how using multiple devices and services together has helped Apple’s business. Along the way, I also reread the message Apple has been consistently sending its users.

Services’ Growing Share of Revenue

Apple’s growth story includes moments of real crisis. If you start from where the company stands today, that history can look deceptively smooth.

Apple went public on December 12, 1980 at $22 a share. Things didn’t stay simple after that. In 1997 the company hit a management crisis, and Jobs, back at the helm, had to rebuild its products and business from the ground up.

The partnership Apple struck with Microsoft that year was part of that rebuilding. Microsoft invested $150 million in Apple’s non-voting shares and committed to continuing Office development for the Mac. The two companies also agreed to cross-license patents. In practice, this meant the software Apple’s customers relied on would keep being supported.

Apple’s business has since changed dramatically in scale. According to its annual reports, revenue was about $233.7 billion in fiscal 2015 and about $416.2 billion in fiscal 2025. Over the same period, Services revenue grew from about $19.9 billion to $109.2 billion. Its share of total revenue rose from roughly 9% to 26%.

Stock prices and market capitalization reflect expectations about future performance. To see how the actual business has changed, you need to look at the composition of revenue itself. In Apple’s case, a growing share of revenue now comes not just from selling devices, but from apps and subscription services that keep generating income after the sale.

Customers who keep using Apple devices are essential to the growth of the Services business. Even during the stretch between upgrades, they can still buy apps or subscribe to cloud storage and content.

What Do 2.5 Billion Active Devices Actually Mean?

In its earnings release on January 29, 2026, Apple announced that active devices had surpassed 2.5 billion. That’s a device count, not a headcount. Someone like me, who uses an iPhone, a Mac, and an iPad together, gets counted multiple times, so you can’t divide this figure by the world’s population to calculate a penetration rate.

The apps running on these devices ripple out into businesses well beyond Apple itself. A study commissioned by Apple, conducted by Analysis Group and others, estimated that transactions and advertising revenue generated through App Store-related apps in 2024 totaled roughly $1.3 trillion. That includes more than $1 trillion in transactions for physical goods and services—food delivery, shopping, transportation, and the like. It’s not a figure that represents Apple’s own revenue.

According to the report, more than 90% of this transaction volume carried no Apple commission at all. That figure shouldn’t be read as developers’ net profit margin. Separately, Apple has said that payments to developers from digital goods and services sales have exceeded $550 billion since the App Store launched in 2008. This differs in both time frame and scope from the $1.3 trillion figure above.

In fiscal 2025, the Services segment’s gross margin¹ was 75.4%, versus 36.8% for the Products segment. Services revenue is smaller than Products revenue, but the share of profit left after direct costs is much larger. Still, you’d need to subtract R&D and SG&A expenses, among others, from there to arrive at the company’s bottom-line profit.

Someone who already uses an iPhone finds it convenient to share photos and files if they also pick up a Mac or an iPad. Services like iCloud and Apple Music then plug into that setup. Not every customer buys these products one after another, but the convenience of using them together can be a reason to make that additional purchase. The MacBook Neo, announced in March 2026, launched in Korea at a base price of ₩990,000 (~$710). With products like this, Apple is also lowering the price barrier to entry.

Counterpoint Research estimated that roughly a quarter of all active smartphones worldwide in 2025 were iPhones. Apple and Samsung were the only brands with more than 1 billion active smartphones, and the iPhone’s net additions outpaced the combined net additions of the next 7 major brands. This is a different metric from market share of smartphones sold new that year. Devices kept for years or passed along secondhand are still counted, as long as they remain in active use.

For the quarter ended December 27, 2025—Apple’s fiscal Q1 2026—revenue came in at roughly $143.8 billion, up 16% year over year. Both iPhone and Services posted record revenue. It was a quarter in which device sales and service usage jointly powered the results.

What the Products Are For

Alongside these numbers, I want to look at how Apple has explained what its products are actually for.

After Jobs returned in 1997, Apple launched the “Think Different” campaign. Alongside photos of figures like Einstein, Gandhi, and John Lennon, it put forward people who challenged convention. Rather than describing product specs, the ad showed what kind of person would choose Apple.

Tim Cook’s 2026 50th-anniversary letter closes with a line from that very campaign. I read it as a reaffirmation of an identity Apple has emphasized for a long time.

Looking at how the products themselves have changed, you see a recurring attempt to make technology easy to use in everyday life.

The 1984 Macintosh helped bring the GUI² — icons and windows manipulated with a mouse — to the mass market. I feel something similar about ChatGPT: it let people use AI through conversation, without specialized knowledge. I don’t mean the two technologies are the same, but I’m looking at both through the lens of making complex technology easy to use.

The 2001 iPod and the 2003 iTunes Store connected a music device to the purchase of digital music. The 2007 iPhone and the 2008 App Store expanded what a single device could do. Apple didn’t invent digital music or the smartphone. But it can be seen as an example of making something widely used by designing the device, the software, and content purchasing together as one system.

When I look at what makes Apple competitive, this connective tissue is what matters most to me. A device that’s great at playing music isn’t enough on its own — finding a song, buying it, and moving it onto the device all have to be effortless for people to keep using it.

Cook’s letter is full of things people have done with Apple products: run marathons, write books, start businesses, stay in touch with family in the hospital, record a child’s first steps. It’s a way of introducing a product by talking about what users can actually do with it.

I think this kind of messaging is tied directly to Apple’s business model. The more uses a product has, the more reasons there are to use its apps and services. And only if that experience is satisfying will people consider Apple again when it’s time to buy their next device.

Oswarld’s Lens

My first smartphone was an iPhone 3GS. Now I use an iPhone 17 Pro, along with a MacBook Pro, a Mac Studio, an iPad Pro and Mini, and AirPods Pro and Max. I touch an Apple product multiple times a day. I’m also an Apple shareholder, so the 50th-anniversary news landed on a more personal level for me.

As someone who’s spent a long time thinking about go-to-market strategy, I see something in Apple that competitors can’t easily replicate: on top of the performance of individual products, the company has built up the convenience of using multiple products together.

Good products attract customers, and a growing customer base becomes the foundation for an apps-and-services business. The profits from that business can then be reinvested in product development. But this cycle doesn’t repeat itself automatically — new products or services have to keep giving existing customers a reason to stay.

From the customer’s side, there’s also the effort of switching to a different product. If you’ve been using AirDrop, Handoff, Universal Clipboard, and iCloud sync together, moving to another company’s products means re-configuring file sharing and device linking from scratch. That’s a burden you won’t see if you’re only comparing the price of a single device.

As someone who works with data, I think market capitalization needs to be looked at separately. The amount the stock market values a company at isn’t the same as the money that company actually earned in a given year. And a shift in stock-price rankings alone can’t tell you which company has the stronger product or who will win in the future.

I see this 50th-anniversary message as another attempt to explain to employees and customers what the company will continue to prioritize going forward. For “Think Different” to keep its persuasive power, future products will need to deliver convenience that people can actually feel.

Closing

What I take away from Apple’s 50 years is that you have to design the experience of using a product, not just the moment you sell it. A great first impression can win a customer, but if the day-to-day use is a hassle, there’s no guarantee of the next purchase.

Services revenue and the active device count show the scale Apple has built up. But whether a customer chooses Apple again comes down to actual, everyday use. Having used Apple products myself for a long time, I’ll be watching to see whether the convenience of running multiple devices together holds up going forward.

References & Further Reading

• Apple, 50 Years of Thinking Different: Tim Cook’s 50th-anniversary letter.
• Apple, Investor FAQ: IPO date and offering price.
• Microsoft, 1997 announcement of the Apple partnership.
• Apple, 2016 Form 10-K, 2025 Form 10-K: revenue composition and gross margin for FY2015 and FY2025.
• Apple, Fiscal Q1 2026 results, 2026.01.29.
• Apple, A record-breaking year for Apple Services in 2025, 2026.01.12.
• Analysis Group·Andrey Fradkin, The Global App Store and Its Growth, 2025.06. Apple-funded research.
• Counterpoint Research, Active Smartphone Analysis 2025, 2026.02.
• Apple, MacBook Neo announcement, 2026.03.04.

The author is Oswarld (Kwangseob Ahn). Current roles: Adjunct Professor at Sejong University, Strategy Consultant at INLEVEL9. Career, research, books, and recent work are kept current on the About page. Latest · July 2026: HEMA-2: A Consolidation-Aware Tri-Memory Architecture with Multi-Channel Scheduling for Lifelong Conversational AI.

Footnotes

1. Gross margin: the ratio of revenue minus cost of goods sold to revenue. It’s different from net margin, which also subtracts R&D expenses, SG&A, taxes, and everything else. ↩

2. GUI (Graphical User Interface): a way of operating a computer through visual elements like windows and icons. It existed before the Macintosh, but the Macintosh was one of the key products that brought it to the mainstream. ↩