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5 Things You Didn't Know About Apple

By John Ballard – Oct 27, 2018 at 7:07AM

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Here are some fun facts about the storied Mac maker.

Apple (AAPL -1.51%) is one of the most iconic brands in the world. Its strong ecosystem of services and hardware has made the company one of the most valuable in the world with a $1 trillion market capitalization. All told, it's one of the most followed companies by investors and consumers alike. Even with all of that attention, there are some interesting aspects of Apple's business that many people may not be aware of.

Here are five things you may not know about this household name.

A black Mac desktop computer

IMAGE SOURCE: APPLE.

1. 1.3 billion devices

As of the first quarter of fiscal 2018, Apple had a growing installed base of 1.3 billion active devices around the world. Additionally, during the recent event to announce the new iPhone XS, CEO Tim Cook mentioned that Apple was close to shipping its 2 billionth iOS device. He also mentioned that over 500 million people visit an Apple Store every year. 

2. Apple is the third-largest video game company in the world

Apple generated $8 billion in revenue from sales of gaming apps in its App Store in 2017, according to industry researcher Newzoo. Only two companies in the world generate more revenue from games than Apple: Chinese social media giant Tencent Holdings and Sony's Playstation. This means Apple is technically a bigger game company than leading game makers like Activision Blizzard and Electronic Arts.

What's more, Apple may remain ahead of the top game makers considering that mobile game sales are the fastest-growing category of video game sales.

3. The idea for multitouch screens on Macs predated iPhone

The conception of the iPhone was not a sudden stroke of genius by Steve Jobs. Instead, it was a slow process of cobbling together different ideas and projects that Apple was working on in 2005. In fact, Apple was already getting to work on making what would become the iPad when Jobs steered Apple's engineers to make a phone. 

As early as 2003, Apple's lead designer Jony Ive and his team were already toying with the idea of using multitouch screens on Mac computers. It wasn't until a few years later that Ive showed the technology to Jobs, which sparked the idea to marry a multitouch screen with a phone.

4. Apple is a serial acquirer

Given that Apple designs its own hardware and software, including its own processor for its iPhone, iPad, and Watch, you might think it never makes any acquisitions. But it does. Its $2.6 billion acquisition of Beats Music in 2014 was much publicized and enhanced the technological capabilities behind Apple's music streaming service. 

The same year Apple bought Beats, the company spent an additional $957 million buying small companies that work on specific technologies. Since fiscal 2008, Apple has spent a total of $7.1 billion on acquisitions. 

Some of the transactions can give a heads-up on certain features Apple is getting ready to introduce. For example, in early 2017, Apple acquired Realface -- a cybertechnology start-up in Israel working on facial recognition. Face ID made its debut on the iPhone X months later. 

Apple's latest acquisition of the popular music app Shazam -- which can detect which song is playing around the listener -- may foreshadow significant enhancements coming to Apple's music streaming service in the months ahead. 

5. Apple may not look the same in 10 years

Apple will continue to make its iPhones and Macs, but other revenue channels could blossom over the next decade. Currently, Apple generates most of its revenue from the iPhone, but that could change considering what it's working on.

First up, there have been various reports of Apple testing self-driving cars. But since it hasn't talked about its plans, it's anyone's guess what the company is up to. What we know is that self-driving cars are expected to be a big trend that could revolutionize the $4.8 trillion transportation sector over the next few decades. Apple has kept its cards close to its vest, but the company seems to have a plan to get in on the action.

The second big growth opportunity is a widely speculated new TV streaming service. Cook recently disclosed they have been hiring TV executives for a project many believe is in preparation to launch its own original content next year. 

It's been estimated that Apple's TV service could be worth $37 billion over several years. This would definitely keep the narrative going about Apple's transformation into a service company, which is the company's fastest-growing sales category currently making up nearly 20% of its total revenue. 

While Apple continues to churn out the same products every year, it's clear management is working on some big projects that many investors aren't aware of yet. This giant company is worth a look.

John Ballard owns shares of Activision Blizzard. The Motley Fool owns shares of and recommends Activision Blizzard, Apple, and Tencent Holdings. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool recommends Electronic Arts. The Motley Fool has a disclosure policy.

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