It must be nice, when things get tough and the vultures are circling, to be able to announce quarterly revenue of almost $100 billion. I imagine that sort of thing puts a smile on a CEO’s face. It really puts a $570 million fine into perspective.
No matter what happens, Apple carries on making metric shedloads of money and setting records every three months. That’s just the way of the world. Doubters come and go, and Apple remains.
At least, it might seem that way. But that’s the thing about empires: they seem eternal until they don’t, and then it becomes obvious in retrospect that their downfall was inevitable. And the tech market is littered with examples of huge companies—Palm, Compaq, Kodak and Polaroid, Atari, Yahoo!, BlackBerry—that once seemed invincibly dominant and are now bankrupt, irrelevant, or a trademark for hire. Apple itself was one wrong step from going under until Steve Jobs returned in the 1990s and turned things around.
Like all those companies, Apple seems invincible. But you don’t have to squint to see warning signs. Last week Apple learned that it will be forced to allow external purchase links inside apps, with Judge Yvonne Gonzalez Rogers so furious about its previous attempts at “compliance” that she accused the company of “[manufacturing] post hoc justifications for maintaining an anticompetitive revenue stream” and deliberately failing to comply with the court’s injunction. “That it thought this Court would tolerate such insubordination,” she concluded, “was a gross miscalculation.”
The public rebuke is embarrassing, and Apple could even face a criminal contempt charge. But its biggest worry is the financial aspect. If enforced compliance means developers can more easily bypass the company’s in-app payment system and the so-called Apple tax, a major revenue stream—Services, which includes in-app subscriptions, hit another record last quarter with $26.65 billion, more than a quarter of Apple’s revenue—is about to shrink.
Of course, Services doesn’t remotely compare to the importance of the iPhone–and here, too, there are clouds on the horizon. Most iPhones are assembled in China, at least for now, and that leaves Apple in a difficult spot politically, pandering to and relying on the whims of an unpredictable president. In the earnings call, Tim Cook revealed that Apple expects tariffs to cost it roughly $900 million next quarter, and his later response to speculation about price rises was ambiguous, to say the least.
Apple faces various options, none of them appealing. It can continue its policy of conciliating the president, which bore fruit in the tariff exemption but is sure to be alienating a chunk of its traditional liberal customer base; or it can hold firm on DEI and social justice initiatives, refuse to pretend it’s feasible to build iPhones in the U.S., and put itself in the firing line for political vengeance. It can absorb the impact of tariff costs and accept a drop in profits, or it can raise prices (as we’ve seen elsewhere with the Xbox) and face a fall-off in demand and likely public backlash. Everything is complicated and fraught with danger—and that’s before we even consider economic uncertainty in the U.S. affecting Apple more than most companies because it’s largely abandoned the budget market.
Across multiple product areas, Apple’s future feels uncertain. The company’s two great moonshot projects, Vision Pro and Apple Intelligence, are failures, albeit in different ways: one a technically impressive proof of concept that was inexplicably marketed as a consumer product, and the other a technical disaster that was somehow launched both too early and too late. Customers who bought the iPhone 16 on the strength of Apple Intelligence, which was emblazoned all over the phone’s marketing materials, are angry that it didn’t deliver, with some even filing lawsuits. Those probably won’t cause Apple’s lawyers many sleepless nights, but you can expect an outbreak of insomnia if once bitten, twice shy customers refuse to believe the iPhone 17 hype and save their money when it comes out later this year.
What do we say to the god of death? Not today. And Apple isn’t in any serious or existential danger right now, as the latest earnings show pretty clearly. But what I will say is that last week’s profit party might prove to be a high-water mark rather than a guarantee of future success. Life is about to get quite a bit harder.
I don’t want to give an impression of doom and gloom. Few companies embody the phrase “too big to fail” better than Apple, which has political influence, immense cash reserves, and an army of diehard loyalist customers–and, lest we forget, just reported a five percent increase in revenue on the same quarter last year. It isn’t going to sink overnight. But make no mistake: a storm is brewing.
Foundry
Welcome to our weekly Apple Breakfast column, which includes all the Apple news you missed last week in a handy bite-sized roundup. We call it Apple Breakfast because we think it goes great with a Monday morning cup of coffee or tea, but it’s cool if you want to give it a read during lunch or dinner hours too.
Trending: Top stories
Once again, Apple has to be forced to do the right thing.
We round up 6 mistakes new iPhone users always make (and how to avoid them).
I’m an Apple fan in 2025. What does that even mean?
How the Apple TV 4K replaced my iPhone as my most-used Apple product.
The Apple Watch is boring. Here’s how Apple can change that.
WTF! You people are taking this AI thing a little too far, warns the Macalope.
Alex Blake reveals 11 essential iPhone features you’re probably not using.
The U.S. tariff drama could lead to slim pickings on Apple Store shelves.
Podcast of the week
The Apple Watch recently had its tenth anniversary, and WWDC is coming up in June. So in the latest episode of the Macworld Podcast, we’re looking at the state of the Apple Watch–where it’s been, where it’s at now, and what’s in store for the future.
You can catch every episode of the Macworld Podcast on YouTube, Spotify, Soundcloud, the Podcasts app, or our own site.
Reviews corner
- Alogic Clarity 5K Touch 27-inch monitor review: Our favorite touchscreen just got 5K.
- Huawei Freeclip review: Open-ear earphones that clip on.
- JBL Flip 7 review: Lightweight but rugged Bluetooth speaker ideal for outdoor music.
- Anker Prime 14-in-1 Thunderbolt 5 Docking Station review: Mac mini like looks and power.
- HyperJuice Qi2 3-in 1 and 2-in 1 Magnetic Charging Stand reviews: Cute, smart and powerful.
The rumor mill
Apple reportedly scraps the iPhone 17 Pro’s anti-glare, anti-scratch display.
The Apple Watch SE is likely to get two new sizes this year.
Code in iOS betas hints at changes to Stage Manager, including iPhone support.
What’s coming from Apple in May before WWDC arrives next month?
Software updates, bugs, and problems
The AirPlay device connected to your iPhone or Mac may be a target for hackers.
Apple warns iPhone owners of widespread mercenary spyware attack.
And with that, we’re done for this week’s Apple Breakfast. If you’d like to get regular roundups, sign up for our newsletters, including our new email from The Macalope–an irreverent, humorous take on the latest news and rumors from a half-man, half-mythical Mac beast. You can also follow us on Facebook, Threads, Bluesky, or X for discussion of breaking Apple news stories. See you next Monday, and stay Appley.