Apple Inc. (NASDAQ:AAPL) can add yet another feather in its cap after Gartner’s latest study puts them as the largest IT vendor in the world with more than $218.1 billion revenue in 2016. This puts them comfortably ahead of a long time rivals Samsung (KRX:005930), who comes in second with $139.1 billion revenue during the same period. Following these two titans are Alphabet Inc. (NASDAQ:GOOGL) or Google with $90.1 billion in revenue, Microsoft Corporation (NASDAQ:MSFT) with $85.7 billion in revenue, and IBM (NYSE:IBM) with $77.8 billion in revenue.
Apple’s lead comes as no surprise, given their massive revenue and profits are driven by their incredibly popular iPhone line of smartphones. It is important to note that this data does not account for revenue from communication services these companies may provide.
A main focus of the report was the gradual shift from the “Nexus of Forces” to digital businesses driving future growth. Companies like IBM and Microsoft have been leaders since the early days of IT, and have managed to adapt to changing climes and remain relevant in this day and age. However, congruence with the “Nexus of Forces“, which includes social, mobility, cloud and information giving rise to new business scenarios, has been the prime factor in dictating success in this industry in modern times.
It is one of the primary reasons behind the immense success of companies like Apple, Samsung and Google. However, even this is now slowly changing with increased proliferation of digital businesses.
As more and more services and products become digitised, control over the digital experience becomes more important. Companies like Google, Apple, Facebook, Amazon, Baidu, Alibaba and Tencent are vying for supremacy in this space. In fact, Gartner believes that by 2021, 20% of all digital interactions will involve one of the top 7 digital giants. However, there is still plenty of opportunity for other companies in the business to business (B2B) world. This is one area that is woefully under-exploited but has huge potential. One example of this is Amazon Web Services (AWS), which is now the leader in the world of enterprise cloud computing solutions.
However, while these revenue numbers are mind boggling, it is important to note that almost all of these companies’ IT revenue depreciated compared to 2015. Apple’s revenue depreciated by 7.2%, while Samsung’s depreciated by 2.04%. Microsoft’s revenue also decreased by 2.72%, while IBM suffered a 2.26% reduction. In fact, the only company out of the top 5 to post growth was Google, whose revenue grew from $74.9 billion in 2015 to $90.1 billion in 2016, at a growth rate of 20.3% YoY. Considering Google’s improving position in the enterprise cloud market, and their strong upwards trajectory, they may very well overtake Samsung in the near future.