Apple normally sends a press release about the latest quarterly figures, but the most interesting is the conference call that follows. Analysts and journalists try to get as much info from Apple as they can, because it's one of the few times that questions can be asked of Tim Cook and financial man Luca Maestri. In addition, we have thoroughly examined the figures and looked at what the highlights are – and there's plenty of them again!
#1 Wearables Now Bigger Than iPad and Mac
Apple's wearables division grew to $8.8 billion in revenue, which is a record. Smart home and accessories also fall into this category. Tim Cook thinks it's mostly because people have searched a lot for entertainment at home and ways to stay connected when they're on the go.
Apple Watch remains a go to choice for users to stay on top of their health, and reach their fitness goals. and our newest accessory AirTag is getting an enthusiastic response from customers, making the Find My network more useful than ever, while protecting user privacy.
75% of Apple Watch buyers in the third quarter were new.
#2 Apple only makes its own components when it can do better
During the conference call, Tim Cook was asked which parts are purchased and which are made in-house. Cook replied that the main issue is whether Apple can make a better product itself.
We ask ourselves if we can do something better. If we can deliver a better product. If we can buy something in the market and it's great and it's as good as what we can do, we're going to buy it. We'll only enter where we have an ability to do something better and therefore make a better product for the user.
Cook called the M1 chip a good example. Apple's own chip team can make a better product than what can be sourced externally.
#3 More than 50% growth in iPhones
The biggest grower of the past quarter? The iPhone! People bought a new smartphone en masse and that resulted in a turnover growth of more than 50%, compared to the same quarter last year. CEO Tim Cook said it's mostly because of people upgrading from an older device, or switching from Android to iPhone.
Never has there been a Q3 in which so many people bought an iPhone. Especially the demand for the iPhone 12 Pro and iPhone 12 Pro Max would be very high. Tim Cook also suggested that the iPhone SE is doing well in emerging markets such as Mexico, Brazil, Chile and India. there are 1 billion active iPhones worldwide
#4 There are 1 billion active iPhones worldwide
Tim Cook reaffirmed that there are now 1 billion iPhones in active use worldwide. In total there are 1.65 billion active Apple devices.
#5 5G still in the starting blocks
Cook has high hopes for the future of the iPhone, mainly due to the demand for 5G. For many people, 5G has been an important buying factor for getting the iPhone 12, and in many countries 5G is just about to start.
#6 iPhone 13 may not come in September
The pandemic caused the iPhone 12 to arrive later than expected in 2020. Or is that also the case this year? Analysts tried to find out whether the traditional September introduction might not be met this year. Apple's CFO Luca Maestri didn't literally say the iPhone 13 will be delayed, but he does warn that sales growth in the September quarter won't be as strong: “We expect revenue growth to be lower than our June quarter year-over-year growth of 36%.”
In 2020, the September quarter wasn't so great as the iPhone 12 didn't appear until the December quarter. As a result, there was a shift in turnover. If the September quarter isn't as strong this year either, it's possible that Apple will have most iPhone sales ná September expected.
It could also be that so many people have bought an iPhone 12 that Apple expects a much lower demand for its successor.
#7 Supply chain shortages
Apple warns that there is still a shortage of components. “The supply constraints that we’ve seen in the June quarter will be higher in the September quarter,” said CFO Luca Maestri. There are also delivery problems with other manufacturers such as Nintendo and Sony. The situation is improving, but many manufacturers are still lagging behind. The shortages will mainly affect the iPhone and iPad, reports Maestri.
#8 Mac and iPad still breaking records
Mac and iPad sales may pale in comparison to the other product categories, but both have record to celebrate. The Mac hit a record in the June quarter, and according to Apple, the iPad had its highest sales in nearly a decade. Both products did well during the pandemic, when many more people started working and studying from home. The introduction of the M1 chip has also increased sales. More Macs with Apple Silicon are coming, but Apple warns of shortages in the supply chain.
#9 Also record in services
With a growth of 33%, Apple's services division is also doing good business. This is partly thanks to Apple TV+ and Apple Arcade. With 17.5 billion dollars in revenue, it is now the largest source of income after the iPhone. There have never been so many devices in use, leading to records for music, video, App Store, and AppleCare.
There are now over 700 million paid users in the App Store. These are people who have made an in-app purchase or subscription. This is four times as much as four years ago. Apple has pushed for it by increasingly asking developers to switch to an in-app subscription.
#10 Apple makes a lot of money from the App Store
The App Store not only generates a lot of money for developers, Apple also benefits from it. In June, a new record was broken, without Apple mentioning concrete figures. Last year developers made $643 billion in revenue, part of which they have to pay to Apple. This is a growth of 24%. Cook, however, did not address the current criticism surrounding the App Store and unfair competition.
You can read more details about the quarterly figures FQ3 2021 in our previous news article.