Apple Inc. (AAPL) Ecosystem Coming Of Age: $16 Billion Run-Rate

3. Retail sales have growth potential

The retail sales from Apple Inc. (NASDAQ:AAPL)’s stores made up only 12% of total sales in the last quarter, but one that is a growing and a stable one too. Apple’s retail stores have been holding up very well as the company’s iconic stores have been pulling in more and more customers. In Q2 FY2013, Apple Stores saw a decent uptick in store visitors with 91 million, which is up from the 85 million foot traffic the company saw a year ago. Total revenue from the retail stores stood at $5.2 billion, which represented a 19% year-over-year growth from $4.4 billion.

The segment’s operating income from its retail presence in 13 countries was $1.1 billion, which represents a 5% year-over-year decline, and was due to the lower prices in most hardware offerings of Apple Inc. (NASDAQ:AAPL). This trend can also be evidenced by the company’s decline in its overall gross margin as well.

Apple has 402 stores, with only 151 stores outside the U.S. And the company plans to expand its retail presence by opening 30 more stores in the next 6 months. As a result the company’s overall operating profit margin was negatively impacted. And Apple will be increasing its retail presence in China with the hope of doubling its presence from the current 11 locations within the next 2 years.

Going forward

Apple Inc. (NASDAQ:AAPL)’s sales of Macs have been relatively flat, but higher-end Macs lead to an increase in revenue even though the market for PCs seems to be bad overall with the global PC market contracting by 14% in the last three months, according to IDC. The size of the smartphone market should double between 2012-2016 and the tablet market is expected to grow even faster with units expected to hit 375 million by 2016 from the 125 million units in 2012, according to IDC.

In addition, retail sales and services sales should both see steady growth over the years. And Apple Inc. (NASDAQ:AAPL)’s fan base seems to be a distinct advantage for the company which leads to very high brand loyalty, and will be ready to snap up Apple products when they hit the market in the second half of 2013.

The article Apple: Three Bright Spots originally appeared on Fool.com.

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