Apple alert: Questor says sell However, how Apple generates its revenue today is far more important for investors. In the most recent full-year numbers revenue was split 50pc iPhone, 20pc iPad,15pc Macintosh, 8pc iTunes, 4pc iPod, and 3pc Accessories. That shows that Apple relies on new product launches for its business and these only have a limited life span. Apple has little by way of recurring revenues. What's more Questor thinks Apple is facing several problems on this new product launch front. First the launch of the new iPhone 5C is a lower cost version of the existing model, this will cannibalise sales and reduce an average sale price of the iPhone that is already falling. Burberry, the British fashion chain, once tried the high volume low cost route and it didn't end well. Apple should take note of what happens when you have a highly branded lifestyle choice product that you start selling cheaply. Second the iPad is still delivering decent sales growth with the number of units almost doubling in the last full year, but the average selling price is falling fast down 11pc during the same period. Questor thinks that average price will remain under pressure in a now fiercely competitive tablet market. Third Apple was way ahead of the market with both the iPhone and iPad products but the competition has now caught up and there are plenty of alternatives. The effect this could have on sales can clearly be seen by looking at the history of iPod sales. When the iPod was launched it revolutionised how we bought and listened to our music. The number of iPods sold increased by more than 10 times between 2004 and 2008, but here they peaked. Sales of iPods have since fallen, competition has eaten into prices and revenue has halved from 2008 highs. Shares in Apple at $498 are down almost 3pc in the year to date. And some will argue they are good value for a growth stock trading on 12.9 times forecast earnings, falling to 11.9 times next year. However, Questor things they are far from a growth stock. In the next 18 months revenue is forecast to grow only anaemically, and earnings per share is expected to be largely flat at around 40c. Questor thinks that is a best case scenario, fierce competition could see Apple's position rapidly eroded. Sure, they have a cash mountain to fund dividends, but dividends can only really be funded from recurring earnings, over which Questor has serious concerns. The next Apple might not be Apple itself, sell.