Apple Inc. (AAPL): A SWOT Analysis

Newer and Existing Products: Apple Inc. (NASDAQ:AAPL) is widely expected to roll-out a big screen TV and even an Apple iWatch, however, these are largely speculations. But the company can generate more revenue from emerging markets for iPhone and iPad products. According to IDC, the number of smartphone marketplace is expected to grow to 1.4 billion units annually by 2016, and the tablet marketplace is expected grow 3 times from current levels to hit 375 million units by 2016. And Apple should be able to grow market-share in both segments.

Threats

Android!: Apple’s biggest threat lies in Google’s open source OS, Android. OEMs especially Samsung have been using Android to roll-out great phones at reasonable prices and gain market share in developing regions of the world. Smartphones running on Google’s Android OS hold a 52% market share, and iOS based devices hold 39.2% market share in the U.S., according to comScore. And Android based devices have seen more than 900 million activations, and this number is widely expected to jump north at a rapid pace.

Newer Products: Apple is constantly facing newer products to both the tablet and smartphone segments, along with competition from existing players. Lower priced devices like Google’s Nexus line, along with Amazon.com, Inc. (NASDAQ:AMZN)’s Kindle line puts additional pressure on Apple Inc. (NASDAQ:AAPL) to scale down prices to stay competitive. BlackBerry, Samsung, HTC are all adding newer and more innovative products into the market as well.

Competition leading to price-cuts: Owing to the existing rivalry in its major product segments, Apple brought down the prices of iPhone and iPad units. The Average Selling Price (ASPs) of each came down sequentially in the most recent quarter. iPhone has an ASP of ~$613, and the iPad has an ASP of ~$449. And going forward, these numbers should trickle down even more, which will negatively impact gross margins.

The bottom line

Apple’s SWOT Analysis definitely points to a number of addressable growth opportunities and threats the company has in the future. While speculation is rife, there are certainly a number of innovative products and services that the company can come up with in the latter half of 2013.

Ishfaque Faruk has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google.

The article Apple: A SWOT Analysis originally appeared on Fool.com.

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