In an extensive interview with The Washington Post, Tim Cook talks about the aspects that have changed in Apple and how he has faced the weight of running the big company after Steve Jobs departure. He discussed the future of the company and the dropping incomes that the iPhone is getting since last year and how the company is relying on its other products to continue to grow. Cook’s fifth anniversary as CEO comes along with the sale of the billionth iPhone.
On August 24, 2011, Tim Cook became CEO of Apple after Steve Jobs handed him the post, six weeks before his death and next week will be the fifth anniversary of Cook in Apple’s office. This birthday comes with the sale of the billionth iPhone which was sold last week. To mark this remarkable achievement, they made a golden iPhone 6s.
The Washington Post interviewed Cook to discuss his experience in these five years as the leader of the successful company that has reached $141 billion only on iPhone sales.
During the interview, Cook explained that the DNA of the enterprise is the same since he first took the job, but the way Apple gets to its goals have changed. The North Star, as he often refers to Apple’s ultimate objective, is to continue making great products that could change the world some day.
Regarding the changes to achieve that goal, Cook said that to broadened the iPhone lineup was a major call and one that has defined his work in the company. Another novelty is that Apple got involved in the smartwatch business with its Apple Watch, which introduced the company into wellness and in health, according to Cook. Since Cook became CEO, Apple has more employees, and it is four times larger than it was in 2010.
Cook insists that the smartphone market is the best in the world, yet, iPhone sales are dropping
But the big question was how is going Apple to face the recent cooling off of the iPhone sales when 44 percent of the company’s revenue depend on it. And Cook answered that depending on the iPhone was a privilege and not a problem. Tim Cook believes that the global market for smartphones, which is a 1.4 billion market, will be a one-to-one in the future. He is convinced that every person in the world would have a smartphone in the long term, and that is an advantage for Apple.
He compares the smartphone business with the boom of TVs. Cook encourages his interviewer to think about all families that have a TV in their house, and how many families have multiple TVs in their homes. Then, Cook adds that the number of TVs in the word are not one-to-one, and it would not be one-to-one, which is contrary to what will happen with smartphones, according to him.
Cook says that the key to the smartphone market is the core technologies that are part of smartphones in the present. He mentioned artificial intelligence (AI) and stated that this technology would make phones even more essential to customers. Meaning that people in the future will not be able to leave home without a smartphone.
For Cook, the level of performance of smartphones is going to skyrocket because there will be nothing that could replace them in the short or the intermediate term.
The iPhone, launched by Jobs, is now the biggest source of income for Apple and the lead product on the company’s growth since Cook took over the CEO post. The iPhone sales represent almost two-thirds of the technology company, reaching $141 billion in the past four quarters. This amount of money is more than the annual figures of Cisco, Disney and Nike combined, The Washington Post reports.
But from a year ago, iPhone sales fell 23 percent, making a total of 14.6 percent drop in Apple’s overall revenue. What is concerning is that after 13 years of growth, this is the second straight quarterly drop.
Despite that fact, in the S&P 500 index, Apple remains the most valuable and most profitable company.
In response to the recent decrease in iPhone sales, Cook says that the smartphone industry will grow 1 percent one day, and it could drop 6 percent the next day. The thing is that the global economy is not in its best moment right now according to Cook. Still, he believes that the smartphone business is a long haul, and if you are willing to stay with it, you will see positive results. For Cook, it is the best market on Earth.
He said in the interview that it does not mean that Apple is not going to do anything else. Cook just wanted to make it clear that despite the drops for this quarter, year or years, the smartphone business is an incredible category to be participating as a company.
Apple as a long-term growth company. More products that will change the world
Apart from the iPhone, Apple does have other products, and services, like the iPad, the iCloud, the App Store and Apple Play. Only the services grew from $4billions to over $23 billion in sales in a period of 12 months.
The next step for Apple is the iPad and the iPad Pro that will be made to guarantee that Apple products and the ones in an enterprise work together. This idea is now part of Apple’s goals because half of the people that buys iPads are using them in their workplace.
Cook says that the company is collaborating with key partners like IBM, Cisco, and SAP to improve the performance of its products in the office. Last year Apple did $25 billion in the business world, and Cook’s vision is to expand from the enterprise world to markets. The company has already begun its journey in China and India’s market with positive results.
Source: The Washington Post