Apple Inc. (NASDAQ:AAPL), riding high on its innovative products like iPod, iPhone, Macbook Air and iPad, is standing firm against its rivals, as of now. Apple’s competitors, which are relatively more experienced than the iPhone maker, enjoy a mix of tangible and the intangible assets, which gives them a distinctive edge. Despite being on the lower ground, Apple has scored more profits from its iPhone franchise than all of them.
But, the question that arises here is—what now? Many experts are already raising questions about Apple Inc. (NASDAQ:AAPL)’s future growth rate. However, what many experts are missing is the “profound opportunity the company has to turn some of the world’s most loyal customers into an annuity business, a recurring revenue stream,” says a report from Forbes by Mark Rogowsky. Also, it remains to be seen whether or not the iPhone maker will be able to monetize these loyals before they switch their preferences.
Pros And Cons Of Tail Risk Funds
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Advantages enjoyed by rivals
Amazon.com, Inc. (NASDAQ:AMZN) has an unassailable infrastructure in ecommerce space with assured returns. Google Inc (NASDAQ:GOOG) has an unmatched keyword advertising business backed by world’s leading search engine. Apart from these current revenue streams, there have also been talks of self-driving cars and Google Glass, which will surely drive growth for the company as well.
Apple Inc. (NASDAQ:AAPL)’s most conventional rival, Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) enjoys an envious market share in the smartphone segment globally. The Korean firm gets a huge advantage from its near perfect vertical integration, making most of the components itself that are required to make a smartphone.
Microsoft Corporation (NASDAQ:MSFT), apart from its core business, has a Bing search engine, which though not highly popular, is a good option. Microsoft also has Xbox and Azure. The gaming platform is a highly successful segment for the company, and Azure is now a billion-dollar business.
Apple has massive cash at its disposal
With more than $140 billion in cash and an average of $10 billion profits in the first three quarters of its current fiscal year, Apple Inc. (NASDAQ:AAPL) will have around $200 billion at its disposal to spend on securing its future. Also, the company could easily double this amount by taking on debt or issuing equity.
With so much cash at its disposal, Apple Inc. (NASDAQ:AAPL) could use it to build recurring revenue streams or grow its business in many ways. Apple can build more on its mobile advertising through acquisitions.
Apple Inc. (NASDAQ:AAPL) currently depends on many of its suppliers for components, like Samsung, Sharp, Qualcomm, Inc. (NASDAQ:QZOM) etc. However, it can utilize cash in strengthening its position by buying itself more freedom and more technology leadership.
The Cupertino-based company could also build upon its apps and media business, which currently generates about $15 billion annually, with a potential to grow further.
In short, Apple Inc. (NASDAQ:AAPL) can work on many options with such financial resources at its disposal; also it might be that the company may be actually working on some future strategies. One thing we can be sure of is that Apple, given its stature, will surely consider all possible scenarios and leave no stone unturned to maintain its growth run.