“Tim Cook commented in a recent interview that their impact on health will be ‘Apple’s greatest contribution to mankind.’ While ‘greatest contribution’ doesn’t necessarily mean ‘biggest business,’ it may mean Apple would pursue a path toward improving primary healthcare by leveraging wearables, AI, and their user-centric software to connect consumers, providers, and payers,” Gene Munster writes for LoupVentures. “We believe the healthcare opportunity is not currently priced into shares of AAPL.”

“Apple’s approach to the Healthcare industry is largely unknown. What we do know is the Apple Watch and eventually AirPods create new ways for consumers to track and manage wellness, notably by tracking heart rate, activity, and heart health. In the future, we expect the company to add biomarkers like blood pressure and hydration,” Munster writes. “The wearables segment represents a measurable revenue opportunity given it’s small today and foundational to Apple’s healthcare master plan. Wearables (90% of which is Watch and AirPods, 10% Beats) account for 5% of sales today, and we expect that to grow to ~8% of sales in five years.”

“We believe Watch sales have reached 67m units since the product was released in mid-2015 and estimate 85% of those are still in use, resulting in an active installed base of 57m,” Munster writes. “We can build a case that the Watch business will eventually be 4x bigger than today, which would imply $35B in annual sales, compared to $8.8B in FY18. Factoring in an asp of $300 yields 115m annual units, up from about 23m at a $375 asp last year.”

“Apple’s healthcare services opportunity likely lies in harvesting the data from Watch and AirPods, then filtering, analyzing, and making it actionable. AI will be foundational to these services given the volume of data that needs to be processed,” Munster writes. “The offering would likely start with the consumer paying ~$300 for a Watch that captures heart rate, activity, sleep, temperature, blood pressure and makes the data actionable, then the physician would pay Apple a per month per user fee (~$10).”

Much more in the full article – recommended – a href=”https://loupventures.com/apples-likely-healthcare-roadmap/” target=”_new”>here.

MacDailyNews Take: Health and wellness is a yet another (massive) among many opportunities (present and future services and products) that’s not priced into AAPL shares.

SEE ALSO:
Apple CEO Cook on Health Records privacy: I want to ‘deeply trust’ the ‘people that have my health data’ – February 28, 2019
Apple is betting big on the $7 trillion healthcare space, with its own devices the key – February 21, 2019
Apple is so serious about health, Apple Stores have started hosting heart-health events – February 12, 2019
Apple’s health records work with the VA is a big deal, and not just for veterans – February 11, 2019
Apple announces Health Records feature coming to American veterans – February 11, 2019
Apple job openings for health-related positions up 400% since 2017 – January 17, 2019
Apple’s digital health plan puts the iPhone and Apple Watch at the heart of your wellbeing – January 16, 2019
Apple’s next really big thing: Health – January 9, 2019
Study shows active Apple Watch users gain extra years of life – November 28, 2018
Apple’s profound iPhone plans for healthcare – June 15, 2017
Apple acquires Gliimpse – August 22, 2016