Apple CEO Tim Cook says revenues from wearable products such as the Apple Watch and AirPods truly wireless earbuds, have exceeded that of iPods’s revenues at its peak. In an interview with CNBC, Cook said that revenue for wearables is already 50 percent more than that of its music player at its peak. This is the first major interview by Cook since he announced the decline in demand for iPhone during the fourth quarter of 2018 and revised guidance just weeks ahead of the quarterly results. He also added that the Watch and the AirPods have each generated between four and six times more in sales than the iPod generated in the same amount of time since its launch.
Since Cook became CEO of Apple in 2011, he has been looking for the next big product after iPhone. While iPhone contributes over 50 percent of its revenue each quarter, Cook has set his sights on selling more products like the Watch and AirPods. “On a trailing basis, … the revenue for wearables is already 50 percent more than iPod was at its peak,” Cook told CNBC‘s Jim Cramer in an interview. He believes that these numbers are important since the iPod was a turnaround product for Apple.
During the fiscal four quarter earnings release, Apple announced that it will no longer offer individual unit sales for iPhone, iPad and Mac devices. The company said it will instead focus on revenue and the average selling price for devices like iPhone, which has been growing for the past few quarters. However, the company had to announce early this month that it will miss guidance announced in November, and projected a new guidance which was lower by nearly $9 billion. The new guidance forced Apple stock price to drop from its initial $1 trillion market cap to under $700 billion.
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With iPhone sales slowing down globally, Apple is putting its weight behind products like Apple Watch, which has been transforming into a health care device. Apple is expected to introduce a new AirPods this year with wireless charging support and better connection. While the 2019 iPhone, rumored to feature triple rear camera, will remain the most anticipated device this year, the company is now trying to move beyond its dependency on iPhone.