Not Just iPhone: Apple’s Services Are Growing Too
Tech companies are increasingly diversifying their business strategies, which, coupled with positive market responses, boosts their profitability.
These companies aren't just focused on creating gadgets; their primary revenue now comes from software development, which has driven them to expand into various services. While companies like Apple offer a wide range of devices, their service verticals, including streaming, cloud, and fitness, continue to grow each year.
Apple has bolstered its ecosystem with services like Apple One, a subscription that bundles several services together. This integration strengthens users' reliance on Apple’s ecosystem, making it harder for them to switch to competitors, thereby enhancing user loyalty to its devices.
Apple has also invested in improving and expanding existing services. For example, Apple Pay continues to see global adoption, while the App Store remains a significant source of income for app developers worldwide.
In the third fiscal quarter of 2024, Apple’s services vertical generated $24.213 billion, a 14.1% increase compared to the same period the previous year. This segment includes the App Store, Apple Music, iCloud, Apple Pay, and Apple TV+, among other products.
Amazon is another company diversifying its service offerings. Its platforms like Twitch and Prime Video generate significant ad revenue. Amazon is also expanding its sports content, having acquired rights to broadcast NFL games and recently securing exclusive rights to stream matches of the Chivas soccer team on Prime Video.https://thong-prakai-saet-ep8.webflow.io/ https://app.warmwelcome.com/widgets/805373ec-d45b-4321-93ce-d162adb6ccb9
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Although Amazon rarely breaks down Prime Video's specific revenue, the service plays a critical role in driving subscription growth and customer retention for Amazon Prime.
Alphabet (Google’s parent company) is also gaining traction in its services division, particularly through Google One and associated services, as shown by data from fiscal year 2023 and the first quarters of 2024.
The subscriber base for Google One has grown due to the increasing demand for cloud storage, both for individuals and businesses. This growth highlights Alphabet's success in offering scalable, affordable cloud services.
In the second quarter of 2024, Google Cloud, which includes Google One, generated $10.35 billion in revenue, marking a year-over-year growth of 29%.