Apple transitioned its strategic focus from smartphones to an ambient computing platform on May 11, 2026. The company now prioritizes the Vision Pro and Ray-Ban-style smart glasses as its flagship hardware. Under this model, the iPhone functions as a secondary processing device for wearable technology.
This shift follows a second quarter in 2026 where iPhone revenue reached $57 billion. That figure represents a 22% year-over-year increase for the smartphone segment. Services revenue reached $31 billion during the same period.
Apple secured over 50% of TSMC’s 2nm chip production capacity for 2026 to support this transition. This supply chain agreement will provide the capacity for future A20 and M5 processors.