Yes Apple does cannabalize its own products, iPod-> iPhone & notebooks -> iPads for instance. From what I remember this was also how Jobs et al. at Apple views it.
Basically if you want to be a innovator you can't worry about eating your own.
Incidentally Tesla has done the same with Model 3 / Y eating up S / X sales.
It's the new normal, get used to it.
The MAG7 isn't pumping all their FCF + new debt issuance into DC's just for fun.
The world is seemingly moving into a era where compute is becoming expensive and scarce.
Only thing that can possibly change this is LLMs hitting a vertical unscalable wall.
More AI compute = more CPU, memory, storage needs.