Some investors who missed the purchase Apple (AAPL 0.17%) stock in 2010 can kick itself. For the lucky group who invested $1,000 in Apple stock twelve years ago, their investment would be worth $18,400 today. That’s an impressive return on investment over any period.

But can Apple replicate its past success in the future? Let’s take a closer look at the likely causes of Apple’s past performance and consider whether investors buying Apple stock today can expect similarly impressive returns.

The iPhone is critical to Apple’s success

Apple’s dominant performance over the past decade could not have been achieved without the resounding success of the iPhone. A 2019 estimate suggests that Apple has sold at least 1.4 billion iPhones over the past 10 years. In its last two quarters, iPhone net sales totaled $122 billion, up from $114 billion in the same period last year.

The iPhone is the center of Apple’s ecosystem that keeps customers coming back for new releases of similar products. Indeed, in the two quarters mentioned above, iPhone sales totaled 55% of Apple’s $221 billion in overall sales.

AAPL revenue (quarterly) given by Y-Charts

The popularity of Apple Watch, AirPods, Apple Music and more would not be possible without the massive consumer base that owns an iPhone. Nevertheless, Apple has created several products that have gone through many iterations. This demonstrated ability to develop innovative products fueled Apple’s stock price performance.

Investors are confident that Apple will sell billions of its existing products and is likely to create new products that can achieve similar or even greater success. Otherwise, Apple’s market cap wouldn’t be north of $2 trillion.

Even with its impressive market share, selling products tends to be cyclical and riskier than selling software services. With services, consumers pay for services through recurring subscription fees, which reduces business risk and provides a steady revenue stream. Over the years, Apple has grown its services segment to become a significant part of its business.

In the second quarter ending March 26, Apple had 825 million Apple Music, iCloud and Apple TV+ subscribers, up from more than 165 million last year. The segment totaled 20% of Apple’s overall sales in the quarter that ended in March.

Another advantage of a booming service segment is that these units often produce higher margins. Apple’s services segment posted a gross margin of 72.6%, which is significantly higher than the product segment’s gross profit margin of 36.4%. As shown in the chart below, the higher gross margin in the services business has increased Apple’s overall gross margin.

Investors equated the growth in the services segment due to its lucrative 72.6% gross margin and recurring nature. This is significantly higher than its product segment gross profit margin of 36.4%. The higher gross margin in the services business boosted Apple’s overall gross margin.

AAPL Gross Profit Margin (Quarterly) given by Y-Charts

Can Apple replicate its success of the previous decade?

While Apple’s stock price may not replicate the scale of success, it is likely to maintain its position as one of the world’s most dominant tech companies. People are spending more and more time on their electronic devices, and Apple has already earned the trust of billions of people. This could mean that if or when Apple releases a new product, it will attract a larger portion of the population who will at least try it.

For example, reports suggest Apple has been secretly working on a self-driving electric car. If this product is widely adopted by customers among existing Apple fans, it could generate massive gains for shareholders. Of course, it’s nearly impossible to predict what Apple’s precise returns will be over the next decade, but the company seems like a safe bet to enrich today’s investors over time. Over the past few weeks, Apple shares have been caught up in the market’s sell-off, but this is allowing long-term investors to buy shares at a lower price.