People Walk Past Apple Store Displaying iPhone 17 Pro Poster in Chengdu

People in front of an Apple Store featuring a large poster of the iPhone 17 Pro in Chengdu, China, in October (Cheng Xin/Getty Images)

Apples to apples

Apple is becoming more of a services company and less a product company

Apple reports earnings Thursday.

Rani Molla

10/30/25 8:54AM

Apple is a giant company with lots going on, but for the top-line numbers it reports Thursday, the company divides itself into two main categories: Products and Services. Products includes the hardware Apple is most known for, including the iPhone, iPad, and Macs.

Its Services revenue is a bit squishier and encompasses everything from the money it makes off the App Store, iCloud storage, Apple TV, and the not insignificant ~$20 billion a year Google pays it to be the default search engine on Apple’s products.

Further in its earnings report, Apple provides iPhone revenue, which makes up the bulk of its Products revenue. We believe that’s both a good proxy for products and also for what’s going on at Apple: revenue from its main product, the iPhone, has been stagnating and even declining, while services have increasingly become a more important part of the company’s sales. For the company’s earnings today, the Bloomberg analyst consensus estimate has Apple’s Services revenue at $28.3 billion and iPhone revenue coming in at $49.3 billion.

That transition is probably fine with Apple, since its Services segment is much more profitable than its Products segment: Apple’s gross margin on Services is roughly double that of Products. Last quarter, for example, its Services gross margin was 75.6% compared with 34.5% for Products.

That’s why its fights with Epic Games over outside App Store fees as well as its involvement in Google’s monopoly case are so important to Apple and its stock price.

Regardless of what happens with the company’s latest iPhone today, which so far is seeing better demand than recent models, expect Apple to also emphasize how well its increasingly important Services segment is doing.

Rani Molla4h

Meta’s reported 20% layoff could bring headcount to its lowest level since 2021

Meta is rising Monday morning after Reuters reported the tech giant is planning to lay off 20% of its employees in an effort to use AI to make its workforce more efficient and offset its surging AI capex costs.

On the company’s last earnings call, CEO Mark Zuckerberg touted 30% efficiency gains for its software engineers and said some “power users” of the company’s AI coding tools saw productivity jump as high as 80% — what some saw as a veiled threat to employees who failed to use AI to boost their output.

Meta’s headcount was nearly 79,000 last quarter, having steadily risen since its layoffs during the self-described “year of efficiency” in 2023. A 20% cut would bring headcount to around 63,000 — the company’s lowest level since 2021.

Shares were recently up 2.7%.

Exclusive: Meta planning sweeping layoffs as AI costs mount

Shares were recently up 2.7%.

Rani Molla

What we know about Tesla’s Terafab project, which Musk says is launching in a few days

Elon Musk says the goal is to produce 100 billion to 200 billion AI chips a year.

Jon Keegan5h

Report: Amid safety failures, ChatGPT’s planned “adult mode” caused concern within OpenAI, with minors misclassified as adults 12% of the time

Despite a series of alarming mental health safety failures that resulted in ChatGPT users allegedly using the product to plan suicides and murder, OpenAI decided to double down on its plan to roll out an “adult mode,” allowing the AI chatbot to produce erotic content.

That decision raised alarms within the company, warning that users could develop unhealthy emotional dependence on the chatbot and that the new age estimation feature was imperfect — and therefore likely to allow minors to access the feature — according to a new report from The Wall Street Journal. Per the report, some 12% of the time, the age estimation feature mistakenly classified minors as adults.

OpenAI’s council of mental health experts were “furious” and unanimous in their opposition to the plans to move forward with the adult mode feature after they were told about the decision in January, with concerns about creating a “sexy suicide coach.”

Earlier this month, the company said it would delay the new feature to focus on other products.

OpenAI’s Bid to Allow X-Rated Talk Is Freaking Out Its Own Advisers

Earlier this month, the company said it would delay the new feature to focus on other products.

Rani Molla3/13/26

Amazon raises the price for ad-free Prime Video to $4.99

Amazon is giving consumers more — for more. The e-commerce giant is raising the price of its ad-free Prime Video tier to $4.99 a month, up from $2.99.

On April 10, the service, now rebranded as Prime Video Ultra, will allow more concurrent streams (five instead of three) and up to 100 downloads, up from 25. Ad-free Prime Video had been included with a Prime membership until 2024, when Amazon added ads and began charging $2.99 a month to remove them.

For what it’s worth, ad-free Prime Video is still cheaper than the other increasingly expensive streaming services — if you don’t include the cost of Prime.

Prime Video’s Ad Free subscription becomes Prime Video Ultra for $4.99 a month

For what it’s worth, ad-free Prime Video is still cheaper than the other increasingly expensive streaming services — if you don’t include the cost of Prime.

Jon Keegan

3/13/26

Most Americans have heard about data centers — the more they learn, the more negative their views

A major survey by Pew gives us a good look at how Americans are thinking about data centers as they start popping up in communities across the US.