Apple Inc.

American company
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Also known as: Apple Computer, Inc.
Written bySteven Levy,
Karl Montevirgen
Fact-checked byThe Editors of Encyclopaedia Britannica
Updated: Dec. 04, 2024•Article History

Encyclopædia Britannica, Inc.

formerly:
Apple Computer, Inc.
Date:
1976 - present
Ticker:
AAPL
Share price:
$243.01 (mkt close, Dec. 04, 2024)
Market cap:
$3.67 tr.
Annual revenue:
$391.03 bil.
Earnings per share (prev. year):
$6.09
Sector:
Information Technology
Industry:
Technology Hardware, Storage & Peripherals
CEO:
Mr. Timothy D. Cook
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Apple Inc. is an American multinational technology company that

revolutionized the technology sector through its innovation of computer
software, personal computers, mobile tablets, smartphones, and computer
peripherals.

One of the most recognizable brands in the world, Apple created the first
commercially successful personal computer and was also the first to bring
the graphical user interface (GUI) into mass adoption.

Founded by Steve Jobs and Steve Wozniak in 1976, Apple set new
benchmarks in product innovation, user-centric functionality, aesthetics
and design, and multiproduct integration. Apple redefined and
transformed the capabilities of modern computing. Further, Apple
innovated the industry by establishing a marketplace ecosystem for third-
party application developers, leveraging this new economy to expand its
products’ functionalities and strengthen its position. The company is
headquartered in Cupertino, California.
Britannica Quiz

Electronics & Gadgets Quiz

Explore a photo slideshow of the history of Apple, Inc.

Encyclopædia Britannica, Inc.

Key products and services

 Mac computers. Evolving since 1984, the Mac line has set
standards in the world of personal computing.

 iPhone. Essentially a sophisticated computer packaged in a flat

cube, the iPhone was a game changer in mobile technology, altering
the way people communicate and consume media.

 iPad. Bridging the gap between smartphones and laptops, the iPad
opened up a new market for digital tablets since its debut in 2010.

 iPod. A digital music player, the likes of which hadn’t been seen
since the Sony Walkman, the iPod revolutionized the music industry
in 2001, transforming the way listeners consume music.

 Apple Watch. Launched in 2015, the Apple Watch is among the

most dominant products in the wearable tech sector.

 MacBook. Apple’s brand of laptop computer, the MacBook has

become a mainstay in personal and professional environments.

 Apple TV+. As Apple’s entry into the streaming entertainment

services, Apple TV+ has become a dominant player in the
subscription-based entertainment sector.

 AirPods. Since the product’s launch in 2016, AirPods have become a

leader in the wireless audio market.

1976: Garage days and the first Apple

computer
The genesis of Apple Inc. sprang, not from a vision of an ambitious
venture, but from a more modest aspiration: Stephen G. Wozniak had a
lifelong dream of building his own personal computer.

Wozniak was inspired by the Altair 8800, the first commercially successful
microcomputer launched in 1975. Further encouraged by his friends at the
Homebrew Computer Club, a hobbyist group, he quickly developed a
simple gaming motherboard: his first personal computer.
In order to create their new company, both Wozniak and Jobs sold some of
their possessions. For Wozniak, it was his HP programming calculator.
Courtesy of Apple Computer, Inc.
The first Apple computer.
Courtesy of Apple Computer, Inc.
The Apple II's motherboard had eight expansion slots, providing users with
more flexibility when deciding what to add to the computer.
Courtesy of Apple Computer, Inc.
Wozniak, then a 26-year-old engineering intern at Hewlett-Packard,
presented his design to his employer. When the company expressed no
interest, Wozniak teamed up with a former high school classmate, 21-
year-old Steve Jobs. The two decided to set up their operations in the Jobs
family garage, founding Apple Inc. on April 1, 1976, along with Ronald
Wayne, an experienced tech industry executive who would play a role in
helping facilitate and integrate the young founders’ company vision and
operational pursuits.

Jobs and Wozniak each held a 45% stake in the company; Wayne had a
10% partnership stake. To fund their venture with working capital, Jobs
sold his Volkswagen minibus and Wozniak his programmable calculator.

With the help of its first angel investor and Intel Corporation veteran
Armas Clifford “Mike” Markkula, the company unveiled its inaugural
product, the Apple I, in July 1976 at a Homebrew Computer Club meeting.
Selling for $666.66, the Apple I was a bare motherboard with a basic CPU,
random access memory (RAM), and video capabilities, but no keyboard or
monitor. Nevertheless, the company’s first product marked the garage
start-up’s first success—however minor—selling 200 units that year. Later
that year, Ronald Wayne decided to leave the fledgling company, selling
back his 10% share for $800.
1977–1978: Apple II and early commercial
success
In January 1977, with Markkula providing his expertise and seed funding
of $250,000, Apple Inc. was incorporated.

Apple II, the company’s next product, was released in April 1977 and
became the first widely distributed microcomputer. It was a commercial
success; some 5 or 6 million units were sold over the next decade.

This new iteration hinted at a slight design breakthrough with its custom-
molded plastic casing, a departure from the steel-encased designs of the
time. The Apple II also included color graphics, sound, and television plug-
in capabilities. Selling for a base price of $1,298, it was perceived as a
user-friendly product, contributing to its success among general
consumers.

Having achieved its first milestone in the larger consumer market, the
company boosted its competitive position when Wozniak introduced a disk
controller enabling an affordable floppy disk drive. This inclusion
enhanced Apple II’s data storage and retrieval, making it faster and more
reliable.

1979: Innovations—GUI, mice, and icons

In 1979, Jobs led a team of engineers to see the innovations created at
the Xerox Corporation’s Palo Alto Research Center (PARC) in California.

Apple's Lisa computer, introduced in 1983, featured a graphical user

interface.
Courtesy of Apple Computer, Inc.
At PARC, they were shown three features that would serve as the
company’s game-changing innovations:

 The functional graphical user interface (GUI), featuring on-screen

windows

 A pointing device known as a mouse

 The use of icons (pictographs) in place of awkward command line

instructions

These features would be integrated into two key projects in development:

the Apple Lisa (released in 1983) and the Apple Macintosh (1984). (Xerox
would later sue Apple in 1989, claiming it stole the idea for its graphical
user interface. The lawsuit was dismissed in 1990 on technical grounds,
with the court saying Xerox chose the wrong venue to argue most of its
legal points.)

The idea was to develop low-cost and user-friendly personal computers

that would introduce the two innovative features—the GUI and mouse—to
mass consumers. Although both computers sported these new features,
they were designed to appeal to different audiences. The Lisa was geared
toward business professionals, while the Macintosh targeted the broader
consumer market.

1980–1985: Competition from IBM,

Macintosh, and Steve Jobs’ exit
Apple’s profits and size grew at a historic rate. By 1980 the company
netted over $100 million and had more than 1,000 employees. In
December 1980, Apple went public, offering 4.6 million shares at $22
each.

Apple’s initial public offering (IPO) was the biggest since 1956 when Ford
Motor Company went public. Further, by the end of 1980, Apple’s nearly
$2 billion valuation was greater than Ford’s.

IBM enters the PC market. As a formidable contender in the emerging

PC market, Apple would soon face competition from IBM, the computer
industry’s leading player.

IBM launched its own version of the personal computer in 1981, breaking
with its tradition of using only proprietary hardware components and
software. Instead, IBM built its PC using readily available components,
including an Intel microprocessor and a disk operating system (DOS)
from Microsoft Corporation.
Because other manufacturers could use the same hardware components
that IBM used and license DOS from Microsoft, new software developers
could count on a wide IBM PC–compatible market for their software. The
system soon had a new spreadsheet program, Lotus 1-2-3, that changed
computing and created what would later be known as a “killer app”: a
software program (application) so useful that it propels hardware sales.

IBM’s PC won instant support and popularity in the business community,

and the Apple II was unable to dislodge IBM’s position. Flanked by its
existing suite of business computing products, IBM’s new offering struck a
fatal blow to the yet-to-be-released Apple Lisa.

Upon its debut in 1983, the Lisa’s $9,995 price tag was more than five
times the cost of an IBM PC. If cost alone didn’t guarantee its commercial
underperformance compared to IBM, the Lisa also had numerous
hardware issues and incompatibilities that made its performance sluggish
compared to its competition.

The Lisa was an epic failure for the company’s foray into the business
computing market. But Apple fared better in the general consumer market
with the release the following year of a product that might even be
considered iconic, culturally perhaps more so than functionally.

Apple launches the Macintosh. Following its failed Lisa launch, Apple
prepared for a second product release, hoping to gain a stronger, if not
dominant, position in the market. The new product was
the Macintosh computer.

Although Jef Raskin led the Macintosh research project as early as 1979,
Steve Jobs took over the project in 1981, having been removed from the
Lisa project due to collaborative tensions. Jobs’ intervention and
contentious disagreements with Raskin on the project’s vision and
direction prompted Raskin to leave the company in 1982.

Introduced to the world via television commercial during Super Bowl XVIII
on January 22, 1984, Apple immediately became a household name. The
commercial, directed by Ridley Scott, struck a hard, albeit symbolic, blow
against IBM, associating it with the dystopian and villainous authority
of George Orwell’s novel 1984.

In contrast, the ad portrayed Apple as the countercultural hero of the

story—a symbol of freedom, progress, and innovation.

The Macintosh’s integration of a user-friendly GUI, all-in-one design, and

affordable price of $2,500 made it accessible and appealing to businesses
and technical users but also, and perhaps more importantly, to general
consumers. Although the ad profoundly affected viewers, becoming one of
the most iconic commercials in Super Bowl history, it generated more
cultural buzz than commercial sales.
1985–1997: Leadership struggles after Jobs
and Wozniak
Despite ecstatic media reaction, the Macintosh initially sold below Apple’s
expectations. The Mac, as it came to be known, had insufficient memory
and storage capacity. It lacked essential features like cursor keys and a
color display, both of which were considered standard amenities for PCs at
the time.

Furthermore, skeptics doubted that adults would ever want to use a

machine that relied on the GUI, condemning it as “toylike” and wasteful of
computational resources.

In the wake of the poor sales performance, Jobs was ousted from the
company in September 1985 by chief executive officer (CEO) John Sculley.
(Wozniak had left Apple in February 1985 to become a teacher.)

Upon exiting Apple, Jobs founded another computer company, NeXT Inc.,
in 1985. The next year, he purchased Lucasfilm’s Computer Graphics
Division to create Pixar Animation Studios. The founding of both
companies, although outside the scope of Apple’s development at the
time, would prove instrumental to the company’s forthcoming era of
innovation in technology (NeXT’s technology was the foundation of
macOS) as well as design and user experience (what is now called UX).

Under Sculley, Apple made steady improvements to the Mac—most

notably, the introduction of an affordable laser printer along with Aldus
Corporation’s PageMaker, the Mac’s first killer app (1985). Together, these
two innovations launched the desktop publishing revolution for consumers
and businesses alike. The graphic arts and publishing industries quickly
became the Mac’s single most important market.

In 1987, the Mac II and Mac SE were introduced. The Mac II was the first of
the Mac line to incorporate color graphics and a modular design, while the
Mac SE was the first of its series to offer an expansion slot (later including
a hard drive bay as a standard feature).

Although these products boosted Apple’s popularity among consumers, as

evidenced by its growing base of one million users, the company would
soon be mired in legal challenges that impeded its pace and progress.

Apple litigates while PCs innovate. The Mac’s incompatibility with

Apple II software, a problem the company initially ignored, slowed
educational sales and compelled the company to retain its outmoded
Apple II line through 1993, hampering its progress as an industry
innovator.
Consumer sales suffered as Apple discouraged game development out of
fear that the Mac would not be taken seriously in the business community.
Moreover, Microsoft, after an unsuccessful attempt to secure an
agreement to market the Mac OS on the Intel processor,
introduced Windows, its own graphical operating system.

Apple litigated for years, in vain, to stop Microsoft from copying the “look
and feel” of its operating system, although the Mac OS itself drew upon
Xerox’s PARC GUI. Meanwhile, as successive versions of Windows
improved and competition among multiple PC manufacturers led to
greater innovation and lower prices, fewer consumers were willing to pay
the premium Apple had commanded owing to its reputation for quality.

As the 1980s drew to a close, Apple would find itself facing a few more
legal headwinds (including its legal battle with Xerox over the graphical
user interface):

 In 1989, Apple Corps Ltd., the Beatles’ record label, sued Apple for
trademark issues related to the company’s name and logo. The legal
battle spanned several years; it escalated in the 2000s when Apple
introduced iTunes and the iPod, thereby entering the music industry.

 Also in 1989, Apple disposed of unsold Lisa units in a landfill in

Logan, Utah. This event became part of tech lore, a symbol of the
company’s biggest innovative flop. Meanwhile, Jobs released the
NEXTSTEP operating system—a significant development, as it would
later serve as the basis for Apple’s Mac OS X upon Jobs’ return to the
company.

Apple-IBM rapprochement. In a surprising move, Apple

and IBM announced an alliance in 1991. In addition to signing a
technology agreement with Motorola, Inc. to develop a next-generation
chip, known as the PowerPC, Apple and IBM created two new software
companies to develop operating system software: Taligent, Inc., and
Kaleida Labs, Inc.

Taligent was expected to enable versions of both the Mac OS and the IBM
OS/2 to run on a new computer hardware standard, the common hardware
reference platform (CHRP). Kaleida Labs was to develop multimedia
software.

But as both companies began to quarrel over CHRP engineering

specifications and costs mounted to about $400 million for Taligent and
$200 million for Kaleida Labs, Apple pulled out with little to show for its
investment.

Apple’s Newton and Claris flops. Sculley also promised more than
Apple could deliver with Newton, a personal digital assistant (PDA) that
suffered from poor handwriting recognition and diverted company
engineering and financial resources.
In addition, the company vacillated over Claris Corporation, its software
division, first reorganizing it as an independent company and then
reabsorbing it when it began shifting more resources to Windows
software.

Apple continues to flounder. In 1993, Sculley was replaced by Michael

Spindler as CEO. Spindler’s most notable achievements were the
successful migration of the Mac OS to the PowerPC microprocessor and
the initiation of a shift away from Apple’s proprietary standards.

Nevertheless, Apple struggled with marketing projections, accumulating

large unsalable inventories of some models while simultaneously unable
to meet a billion dollars in orders for other models.

Combined with drastic quality control problems, notably a defective line of

monitors and some highly publicized combustible portable computers,
these failings brought Spindler’s reign to an end in early 1996 with the
appointment of Gilbert F. Amelio.

1997–2010: Renaissance and reinvention

In 1996, Apple made a pivotal move that would profoundly affect its
strategic direction. After several attempts to develop a replacement for its
aging Mac operating system, Apple purchased NeXT Software, Inc., the
company that Jobs had founded after being ousted from Apple in 1985.

Building on this move, Apple, under Amelio’s leadership, began cutting

operating costs and reestablishing quality controls. Despite these efforts,
only a small percentage of new computer buyers were choosing Macs over
Windows machines. Apple’s financial situation was dire toward the end of
its second decade.

Jobs, now an advisor to Apple’s embattled CEO, quickly became

disenchanted with the company’s direction, selling all but one share of the
Apple stock he had received in the NeXT sale.

When Apple failed to become profitable under Amelio and its worldwide
market share fell to roughly 3%, the board of directors in mid-1997
recruited a surprising temporary replacement: Jobs, who for the first time
became the undisputed leader of the company he cofounded.

The return of Jobs: iMac, iTunes, iPod, iPhone, and iPad. Upon
retaking the helm, Jobs immediately set about revitalizing the company,
announcing an alliance with erstwhile foe Microsoft, ending the half-
hearted (and profit-draining) program to license the Mac OS, streamlining
the company’s multiple (and confusing) product lines, and launching
the iMac, the first of many affordable and innovative products to come
from the now-revitalized company.
1998 photo of Steve Jobs, CEO of Apple (Apple Computer), which he co-
founded in 1976.
Courtesy of Apple
Apple branded its products as part of an upscale lifestyle, or “iLife,” by
emphasizing sleek, minimalist, and aesthetically pleasing designs (like the
iMac) that looked more like modern art than machinery.

Designed to revive Apple’s consumer and educational appeal, the iMac

quickly became the all-time best-selling Mac, lifting Apple’s U.S. market
share to roughly 13.5% in August 1998 from a record low of 2.6% in
December 1997. Moreover, Apple had a profitable fiscal year in 1998, its
first since 1995.
Apple marketed its products as part of an upscale lifestyle, or “iLife,” by
emphasizing designs, such as the iMac, that took up less space and
looked more like modern art than machinery.
© Index Open
In 2001 Apple introduced iTunes, a media player and library software to
store, organize, and play digital audio files converted to MP3 format. Later
the same year, Apple began selling the iPod, a portable MP3 player, which
quickly became the market leader. (The term podcast,
combining iPod and broadcast, is used as both a noun and a verb to refer
to audio or video material downloaded for portable or delayed playback.)
Later models added larger storage capacities or smaller sizes, color
screens, and video playback features.

In 2003 Apple began selling downloadable copies of major record

company songs in MP3 format over the Internet. The iPod Nano digital
music player, one-fifth the size of the original iPod, was introduced by
Apple in 2005. By 2006 more than one billion songs and videos had been
sold through Apple’s website.

In 2007 Apple introduced the touch screen iPhone, a cellular

telephone with capabilities for playing MP3s and videos and accessing the
Internet. More than just a mobile computer and media player merged with
a phone, it pioneered multi-touch features that shaped the way users
interact with technology.
The iPod Nano digital music player, one-fifth the size of the original iPod,
was introduced by Apple in 2005.
Courtesy of Apple
Although the iPhone was designed for the broader consumer market, one
of its biggest competitors—BlackBerry, designed by the Canadian
company Research in Motion (RIM)—was the dominant mobile
communications device among business users.
Apple's touch screen iPhone, released in 2007.
Courtesy of Apple
In response, Apple sought to dislodge RIM’s position in 2007–2009 by
differentiating the iPhone and innovating mobile functionalities that
changed consumers’ needs and expectations, including:

 Multi-touch screen functionalities that allowed users to swipe, pinch

(zoom), and type on a digital keyboard. This was a significant
departure from RIM’s products, which had physical keys.

 Combining text and email—the functionalities the BlackBerry

specialized in—with phone, Internet browsing, and iPod capabilities.
 Compatibility with Mac computers, giving the iPhone integrative
capabilities that far exceeded those of the BlackBerry.

 Upgrading the iPhone in 2008 to make it compatible with 3G wireless

networks and retrofitting it with global positioning system
(GPS) capabilities.

 Creating an ecosystem of third-party apps (Apple’s App Store) that

accelerated the iPhone’s extended capabilities beyond devices, like
the BlackBerry, that relied on in-house development.

Apple’s dual focus on consumer needs and business integration,

positioning the iPhone as a daily extension of home and work life,
eventually gained market share from RIM.

By June 19, 2009, when Apple released the iPhone 3GS (which sold one
million units in the first three days), the company’s share of
the smartphone market had reached about 20% (compared with about
55% for the BlackBerry line of smartphones).

In addition to hardware changes such as a three-megapixel digital

camera that could record digital videos and an internal digital compass
capable of working with various mapping software, the iPhone 3GS
included a new operating system, the iPhone OS 3.0.

The new system included support for voice-activated controls and peer-to-
peer (P2P) play of electronic games with other iPhone users over Wi-
Fi Internet connections. The latter feature was part of Apple’s strategy to
compete in the portable gaming market with the Nintendo Company’s DS
and the Sony Corporation’s PSP. The iPhone can also be used for reading
electronic books, or e-books. E-books in iPhone-compatible formats can be
purchased over the Internet from electronic book dealers such as the
iTunes store and Amazon.com.

In 2010 Apple unveiled the iPad, a touch screen device whose size and
function bridged the gap between a laptop computer and a smartphone.
The iPad was a multimedia tablet that allowed users to operate it with the
same set of finger gestures as the iPhone. Designed with a touch screen
capable of displaying high-definition video, the iPad also provided access
to apps via iTunes and the App Store.
The iPad was released in 2010.
Courtesy of Apple
In 2011 Apple introduced iCloud, a cloud computing service in which a
user’s applications, photographs, documents, calendars, and recently
purchased music would be stored on iCloud servers and automatically
updated on a user’s devices. Some analysts saw iCloud as Apple’s plan for
a future in which users could dispense with the personal computer as the
primary place to store data.

2011–present: Tim Cook as CEO and the

first trillion-dollar company
Jobs resigned as CEO because of ill health in August 2011 and was
succeeded by chief operating officer Tim Cook. Jobs died from cancer two
months later.
Tim Cook, named CEO of Apple Inc. in August 2011.
Courtesy of Apple
In the early years of Cook’s tenure, Apple introduced no all-new products
but rather brought out new versions of previous products, such as
the iPhone 4S, which contained a personal assistant program, Siri, that
could respond to spoken commands and questions (2011); the iPad Mini, a
smaller version of the iPad (2012); and the iPad Pro, a large version of the
iPad intended for business use (2015).

In 2014 Apple made its largest acquisition by buying the headphone

manufacturer and music-streaming company Beats by Dre, founded by
music producer Dr. Dre and music executive Jimmy Iovine, for $3 billion.

Also in 2014, the company launched ApplePay. The app revolutionized

mobile payment systems and altered consumers’ views of digital
transactions, functioning like a convenient and secure digital ATM card.

In 2015 Apple introduced a smartwatch, the Apple Watch, which marked

the company’s entry into wearable technology. Integrating fitness, health
monitoring, and online and iPhone connectivity, the Apple Watch became
a major business segment within the company’s expansive suite of
products.
The Apple Watch was introduced in 2015.
Courtesy of Apple
AirPods, a set of wireless earphones, were introduced in 2016 and became
a top seller in the market. And in 2018, Apple launched the HomePad, a
smart speaker controlled by Siri designed to compete with Amazon’s
Alexa virtual assistant.

Propelled by the popularity of the iPhone, in 2018 Apple became the first
company to reach a market capitalization of one trillion dollars. Two years
later Apple doubled that figure, another first.

In 2020 Apple introduced its own microprocessor, the M1, for Macintosh
computers, which had previously used Intel chips. The M1 was one of the
fastest microprocessors available and was designed to be fast while also
using less power than previous chips. The company subsequently released
updated versions of the M1 chip: the M2 in 2022, the M3 in 2023, and the
M4 in 2024.

From 2020 to 2023, Apple launched a series of product upgrades for

multiple product lines, from its iPhone 14 to its Mac computers.

Apple’s history from a Silicon Valley garage start-up to a trillion-dollar tech

titan reads like an epic saga with the twists and turns of a corporate
thriller. From its early rivalry with IBM to its current position of market
dominance, Apple has innovated and transformed the technological
landscape by challenging established notions of what a product is, how it
should work, and how it can be integrated into our daily lives (both at
home and work). Apple’s trajectory can perhaps best be summarized by
its iconic 1997 slogan, created when the then-struggling company was
poised at the crossroads of self-reinvention: “Think different.”

Steven LevyKarl Montevirgen

References
Frank Rose, West of Eden: The End of Innocence at Apple
Computer (1989), contains a great deal of anecdotal information about
Apple, particularly during John Sculley’s stewardship.

Steven Levy, Insanely Great: The Life and Times of Macintosh, the
Computer That Changed Everything (1994), is a breezy account of the
creation of the Macintosh computer and the development of the graphical
user interface.

Jim Carleton, Apple: The Inside Story of Intrigue, Egomania, and Business
Blunders (1997), is an exposé of the business and engineering mistakes
that nearly bankrupted Apple during the late 1980s and early 1990s.

Owen W. Linzmayer, Apple Confidential 2.0: The Definitive History of the

World’s Most Colorful Company, 2nd ed. (2004), is an exhaustive history
of Apple from its beginnings to the introduction of the iMac and iPod.