Introduction
Apple is at the threshold of becoming the largest US-based technology company and may soon become the largest technology company in the world. This post details the unit sales for the Apple iPhone, iPod and Macintosh personal computers over the most recent eleven fiscal quarters and iPad unit sales for the five fiscal quarters the product has been in commercial release. Apple's dynamic growth is fueled by three major product lines while the Apple iPod, once Apple's flagship product line, slowly fades into history as the product that sparked the company's renaissance and set the stage for what is now the Apple industrial era.
Over the past five years Apple's frenetic rates of growth have been derived from a changing mix of products leading to global leadership in the personal technology markets. This changing mix of products provides for years of dynamic growth as the company expands its global reach, expands the global presence of Apple's retail stores and expands product distribution into previously under served regions of the world.
In Apple's current fiscal year (FY 2011) ending in September and the fiscal year beginning at the end of that month, unit sales of the iPhone and iPad will generate more than two-thirds of the company's reported revenue. Both of these products were introduced to the market within the past five years. The popularity of Apple's iOS-based devices, including the Apple iPod touch, has masked the fact that the Macintosh line of personal computers has become a more than $20 billion global business and in FY 2012 close to 20 million Macintosh computers may be sold.
Apple is at the threshold of becoming the largest US-based technology company and may soon become the largest technology company in the world. This post details the unit sales for the Apple iPhone, iPod and Macintosh personal computers over the most recent eleven fiscal quarters and iPad unit sales for the five fiscal quarters the product has been in commercial release. Apple's dynamic growth is fueled by three major product lines while the Apple iPod, once Apple's flagship product line, slowly fades into history as the product that sparked the company's renaissance and set the stage for what is now the Apple industrial era.
Over the past five years Apple's frenetic rates of growth have been derived from a changing mix of products leading to global leadership in the personal technology markets. This changing mix of products provides for years of dynamic growth as the company expands its global reach, expands the global presence of Apple's retail stores and expands product distribution into previously under served regions of the world.
In Apple's current fiscal year (FY 2011) ending in September and the fiscal year beginning at the end of that month, unit sales of the iPhone and iPad will generate more than two-thirds of the company's reported revenue. Both of these products were introduced to the market within the past five years. The popularity of Apple's iOS-based devices, including the Apple iPod touch, has masked the fact that the Macintosh line of personal computers has become a more than $20 billion global business and in FY 2012 close to 20 million Macintosh computers may be sold.
The Apple iPhone
There's no disputing the fact the iPhone is Apple's biggest revenue product. In the recent June quarter, sales of iPhones and related products and services generated about 46.6% of Apple's $28.571 billion in reported revenue. Over the most recent four fiscal quarters the Apple iPhone generated 44.75% of Apple's $100.322 billion revenue total. The June quarter's 142% unit sales growth and 150% revenue growth for the popular iPhone were well above analyst expectations.
The chart below illustrates the consistent unit sales growth of the Apple iPhone with the June quarter (FQ3) of FY 2010 the obvious exception due to the unique issues surrounding the illicit publication of iPhone 4 photos prior to the product's release and Apple's aggressive pull back on shipments of the iPhone 3GS ahead of the iPhone 4's commercial debut in June of that year. In that quarter more iPhones were sold to customers than Apple shipped into the market for sale, reducing channel inventory in preparation for the iPhone 4's debut.
I expect the release of the iPhone 5 to spark sales of over 30 million units (all iPhone models combined) within the 90 days of the iPhone 5's release date. A pending deal with China Mobile will propel unit sales to levels not seen before even by iPhone standards.
Unit Sales | iPhone | Sequential | YOY | ||
FQ1 ’09 | 4,363 | -36.69% | 88.47% | ||
FQ2 ’09 | 3,793 | -13.06% | 122.72% | ||
FQ3 ’09 | 5,208 | 37.31% | 626.36% | ||
FQ4 ’09 | 7,367 | 41.46% | 6.89% | ||
FQ1 ’10 | 8,737 | 18.60% | 100.25% | ||
FQ2 '10 | 8,752 | 0.17% | 130.74% | ||
FQ3 ’10 | 8,398 | -4.04% | 61.25% | ||
FQ4 '10 | 14,102 | 67.92% | 91.42% | ||
FQ1 ’11 | 16,235 | 15.13% | 85.82% | ||
FQ2 '11 | 18,647 | 14.86% | 113.06% | ||
FQ3 ’11 | 20,338 | 9.07% | 142.18% |
The Macintosh
For more than twenty consecutive quarters the Mac has outperformed the overall PC industry. Although the Mac has been overshadowed by the Apple iPhone and is often overlooked in the era of the Apple iPad, the Mac continues to gain market share and new adherents to the platform.
In the current fiscal year ending in September (FY 2011), more than 16 million Macs will be sold, generating $21 billion or more in revenue. The Mac's resurgence has returned Apple to the #3 spot among domestic PC makers and I expect strong unit sales growth through FY 2012, even as the Apple iPad grows in popularity and dampens global demand for conventional PCs. More than 50% of Macintosh computers sold at Apple's retail stores are to customers new to the platform. The retail stores are a key factor in the Mac's unit sales growth and continuing success.
Unit Sales | Mac | Sequential | YOY | ||
FQ1 ’09 | 2,524 | -3.33% | 8.84% | ||
FQ2 ’09 | 2,216 | -12.20% | -3.19% | ||
FQ3 ’09 | 2,603 | 17.46% | 4.29% | ||
FQ4 ’09 | 3,053 | 17.29% | 16.93% | ||
FQ1 ’10 | 3,362 | 10.12% | 33.20% | ||
FQ2 '10 | 2,943 | -12.46% | 32.81% | ||
FQ3 ’10 | 3,472 | 17.97% | 33.38% | ||
FQ4 '10 | 3,885 | 11.90% | 27.25% | ||
FQ1 ’11 | 4,134 | 6.41% | 22.96% | ||
FQ2 ’11 | 3,760 | -9.05% | 27.76% | ||
FQ3 ’11 | 3,947 | 4.97% | 13.68% |
The Apple iPod
The Apple iPod is in a state of unit sales decline. In the current fiscal year iPod unit sales will total about 43 million units, down from 50.312 million units in the prior year. The Apple iPod touch, an iOS-based device, generates more than half of the iPod line's revenue total.
The mass adoption of smartphones with digital music player functionality has reduced global demand for specific-use digital music players. Apple maintains a commanding lead in the global market for digital music players, but the iPod line's significant year-over-year unit sales decline will most likely continue for at least the next few quarters.
Unit Sales | iPod | Sequential | YOY | ||
FQ1 ’09 | 22,727 | 105.64% | 2.74% | ||
FQ2 ’09 | 11,013 | -51.54% | 3.47% | ||
FQ3 ’09 | 10,215 | -7.25% | -7.23% | ||
FQ4 ’09 | 10,177 | -0.37% | -7.92% | ||
FQ1 ’10 | 20,970 | 106.05% | -7.73% | ||
FQ2 '10 | 10,885 | -48.09% | -1.16% | ||
FQ3 ’10 | 9,406 | -13.59% | -7.92% | ||
FQ4 '10 | 9,051 | -3.77% | -11.06% | ||
FQ1 '11 | 19,446 | 114.85% | -7.27% | ||
FQ2 '11 | 9,017 | -53.63% | -17.16% | ||
FQ3 ’11 | 7,535 | -16.44% | -19.89% |
The Apple iPad
From April 2010 through June 2011, 28.729 million iPads were sold. However, the Apple iPad has had a much greater greater impact on the world of personal technology than the unit sales numbers suggest. Apple was challenged to meet demand with supply when both the original iPad and the iPad 2 were released in the market.
Outside of the Apple iPad a market for tablet products does not currently exist. Apple will maintain undisputed leadership in this product category well in calendar year 2012 and HP's recent decision to cancel the webOS-based TouchPad signals the tablet market remains challenging at best for iPad competitors. Android-based tablets have also yet to find footing in the US and international consumer markets.
First and foremost the Apple iPad is an expansion of Apple's multi-device iOS product paradigm. There are no real indications the world's consumers are interested in a PC in tablet form. There are over 225 million iTunes accounts backed by credit cards. The hundreds of thousands of apps available for iOS-based devices and the volumes of commercial content available through iTunes underpin the iPad's success. Content sells hardware devices.
Unit Sales | iPad | Sequential | YOY | ||
FQ3 ’10 | 3,270 | - | - | ||
FQ4 '10 | 4,188 | 28.07% | - | ||
FQ1 '11 | 7,331 | 75.05% | - | ||
FQ2 '11 | 4,694 | -35.97% | - | ||
FQ3 ’11 | 9,246 | 96.97% | 182.75% |
Moving Forward...
The objective of the Posts At Eventide web presence is to benefit readers seeking to understand Apple's financial performance and to serve as a repository of information and analysis for other independent AAPL analysts preparing quarterly estimates and share price forecasts.
I'll be back in the coming weeks with additional product sales data and analysis as Apple's current fiscal year comes to a close and perhaps the greatest year of growth in the company's history commences in late September.
Disclosure: The author is long Apple shares
Robert Paul Leitao
