This morning Apple announced their latest results and they smashed everyone’s expectations. Earning per share were +40% at $US2.33; Revenue +27% at $58.01B etc. what we’re really interested in are the sales results and what they say about technology.
Here’s what we’re seeing:
1. iPhone is up: 40% increase in units, moving units to 61.2 million. The average selling price of an iPhone was $658.53. This is being driven by China (and potentially the trade-in program they have there with Foxconn). Total revenue for Greater China was up 71%; plus, sales of the iPhone in China outpaced the US for the first time in Apple’s history.
2. iPad sales are down: we were interested to see iPad sales down. This could be because there is less need to upgrade every 2 years (a la with the iPhone and 24 month contracts), or people loosing interest in the iPad as a new screen (Apple watch) takes centre stage; or that the NPD on this product isn’t so markedly different there’s no point in replacing it. Aside from our hypothesising, units of iPads were down 23% to 12.62 million; they expected to sell 13.6 million. The average selling price of an iPad also remains lower than an iPhone at $430.
3. Mac sales are slightly down: they expected to sell 4.7 million units and sold 4.56 million.
4. App store is going strong: they generated $5B in revenue from services.
So, it was really a story about the iPhone and the continuation of mobile being centre. As Tim Cook said:
‘We’re seeing a higher rate of people switching to iPhone than we’ve experienced in previous cycles’.
Finally, it also looks like they are cleaning up their environmental act – they are opening 2 data centres in Ireland and Denmark that will run on clean energy and a ‘ground breaking’ partnership in China to generate solar energy. Plus, a conservation fund to offset the impact of their packaging.
Can’t wait to see how this new, more responsible Apple pans out.