Apple (NASDAQ:AAPL) is a wildly successful company that has delivered tremendous gains for investors over the long term. Over the last 10 years, Apple shares are up more than 1450%, meaning that every $1,000 invested has grown to more than $15,000 as of this writing -- and that's not including dividend payments.

Nevertheless, while Apple is a great company that has proven to be an excellent investment, no company's shares are without risk. Here, I'd like to go over two key risks that current and potential Apple investors should be aware of.

A woman taking a picture with an iPhone XS Max.

Image source: Apple.

Overall smartphone market trends

Apple's business is critically dependent on sales of its iPhone product line. During its fiscal year 2017, revenue from iPhone sales made up 61.6% of the company's net revenue. During the first three quarters of fiscal year 2018, the iPhone was responsible for 63.8% of Apple's sales.

With that in mind, the first risk that investors need to be aware of is that the overall smartphone market is slowing. According to a report published in May by IDC, industrywide smartphone volumes are set to decline by 0.2% in 2018. The researchers also project that smartphone shipments will grow at just a 2.5% compound annual rate between 2017 and 2022.

IDC's figures merely represent forecasts -- they might turn out to be too low, too high, or about right -- but the point is that the smartphone market just isn't growing like it used to.

During the first three quarters of Apple's fiscal year 2018, iPhone shipments were approximately flat year over year. (If you want to nitpick, shipments were actually up 0.44% during that time.) However, the company has driven substantial growth in iPhone average selling prices, fueling revenue growth for Apple in this business over the past year. How long it can continue to successfully grow iPhone average selling prices remains to be seen.

Apple-specific risk

Although Apple is, of course, subject to the trends of the markets that it participates in, the company's performance -- and, in particular, its iPhone business -- is also dependent on Apple-specific execution.

The iPhones introduced in the fall are the company's flagship products for roughly an entire year. This means that they need to remain attractive to consumers as the competitive landscape becomes tougher over the course of an iPhone's time as the flagship offering. (Android smartphone vendors tend to launch new flagships in the months following an iPhone launch.)

It's hard to overstate just how much Apple has riding on each new iPhone introduction. Moreover, year in and year out, the company has to not only develop compelling products (a tough feat in itself that requires Apple to spend billions of dollars per year on research and development), but it also needs to make sure that they can be manufactured in extremely high volumes at acceptable cost structures. This means that Apple has to work closely with its vast network of supply chain partners to ensure that the production ramps of new products go as smoothly as possible.

Naturally, Apple has done a good job with that -- it wouldn't bring in the kinds of profits and be as valuable as it is if its execution weren't consistently solid -- but investors shouldn't assume that the risk of something going wrong is nonexistent.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.