APPLE: THE WORST-CASE SCENARIO - 2016

Mike Nudelman / BI

Apple just booked its biggest ever quarter, with revenues of $76 billion (£52.4 billion). Profits were $18.4 billion - the most of any company, ever.

It also sold 74.7 million iPhones - another record. The company could not be in better shape.

And yet Apple is a troubled beast:

• Investors have driven AAPL stock down 28% over the last 12 months, from $133 to $96.
• CEO Tim Cook admitted on his last earnings call that iPhone sales are about to go into decline.
• iPhone lost market share in every major global market except one last quarter.
• Other major products like iPads and Macs are already in decline.
• And Wall Street analysts are wondering whether the upcoming iPhone 7 will fail to move the needle. "Although we do expect growth in 2017, we do not expect a major iPhone 7 bounce-back," analysts Tavis C. McCourt and Mike Koban at Raymond James said recently.

The fear is that Apple is at its peak, and the only way from here is down.

Of course, only idiots bet against Apple. The company has a history of confounding its critics by emerging from brief troughs with renewed growth and exciting products. (Just look what didn't happen the last time we examined the worst-case scenario for Apple!)

Nonetheless, it's worth asking: What would happen to Apple if everything that can go wrong does go wrong?

Here's the worst-case scenario.