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Products: Apple Inc. (AAPL)

iPhone(iPhone)
iPad(iPad)
Mac(Mac)
Apple Watch, TV and Accessories(Apple Watch, TV and Accessories)
Apple Store and Other Services(Apple Store and Other Services)

iPhone

What is being offered?

The iPhone is the company's multi-touch based smartphone having features that include E-mail, Internet access, media playback, and the ability to run software applications. The company's current line-up includes the iPhone XS, XS Max, XR as well as legacy models such as the iPhone 7 and iPhone 8.

Who is buying?

Retail customers are buying. Customers can purchase subsidized iPhones on with a contract through various carriers. Customers can also buy unsusbsidized/unlocked iPhones from the Apple retail as well as online stores.

Competitors:

Samsung, BlackBerry, LG and Motorola

What buyers care about:

  1. Price
  2. Battery usage
  3. 4G Capability
  4. Application development platform (for developers)
  5. Design and style
  6. Usability of touchpad and display screen
  7. Internet access and data transfer speeds
  8. Mobile phone data storage capacity
  9. Global roaming facility

Apple's top selling points:

  1. Design and brand image
  2. Ease-of-use with touch screen interface
  3. Application development ease for developers
  4. Integration with Apple Store and iTunes for music and video usage
  5. Compatibility with Apple's hardware and software ecosystem

iPhone Pricing

iPhone Pricing represents the amount that Apple receives for every iPhone sold.

iPhone ASPs increased from about $605 in 2013 to about $670 in 2015, driven by the launch of the more expensive Plus size models. However, the number declined to about $650 in 2016, as Apple unveiled a lower-cost iPhone called the iPhone SE. The introduction of the iPhone X, which was priced starting at $1,000 helped Apple further increase ASPs to over $760 in 2018.

Chart: iPhone Pricing

iPhone Shipments

iPhone Shipments represents the number of iPhones that Apple ships in a year.

Apple's iPhone Shipments has increased from levels of around 150 million in FY'13 to about 169 million in FY'14, driven partly by the deal to sell its phones to subscribers of China Mobile. The number rose to 231 million units in FY'15, driven by strong sales of the iPhone 6 and 6 Plus, which marked the company's entry into the phablet space. Sales saw a decline in 2016, amid weaker sales of the iPhone 6S, which customers viewed as being too similar to the iPhone 6. The number grew slightly in 2017, driven by demand for the iPhone 7, although it remained almost flat in 2018.

Chart: iPhone Shipments

iPad

What is being offered?

The iPad is the company's line of multi-purpose tablet computers that run on the iOS operating system. Apple offers the iPad in various screen sizes. The tablets offer an improved reading experience for books, magazines and websites compared to smaller devices like the iPhone and iPod Touch. Using the iPad, one can browse the web, play video games, view photos, watch videos, read email and download apps from the iTunes App Store.

Who is buying?

Individuals

Competitors:

Amazon's Kindle Fire, Samsung Galaxy Tab and several other Android-based tablets.

What buyers care about:

  1. Device's Size and weight
  2. Convenience of handling the device
  3. Pricing
  4. Storage capacity (memory)
  5. Wi-fi and 3G capability
  6. Battery life
  7. Multitasking abilities
  8. Camera
  9. GPS feature for navigation
  10. Processor speed

Apple's top selling points

  1. Light weight and thin size
  2. Front and rear facing camera
  3. Easy of use
  4. Ability to use the device in both landscape and portrait mode.

Apple's weakness

  1. High Price Points
  2. Weaker multitasking capabilities
  3. No GPS feature on WiFi-only versions
  4. No removable batteries

iPad Pricing

This represents the average price of an iPad. iPad pricing is distinguished by the version of the iPad (iPad Air, iPad Mini) as well as the memory and wireless capability.

The pricing for the device is based on the storage capacity as well as the wireless capability (Wi-fi/Wi-fi+4G). iPad's average pricing reduced slightly from $450 in 2013 to $445 in 2014 due to an increasing mix of the older models that were offered at discounted prices as well as the introduction of the lower-priced iPad mini. The number declined further to $423 in 2015 although it improved in 2016, driven by the launch of the more expensive iPad Pro models. The metric fell further in 2017 and 2018, driven by the launch of the low-cost 9.7 inch iPad, priced at $330.

Chart: iPad Pricing

iPad Units Sold

iPad Units Sales represents the number of iPads sold by Apple. The iPad is a tablet PC that is larger than a smartphone but smaller than a notebook PC. The iPad enables users to browse the web, play video games, view photos, watch videos, access email, and download apps from the iTunes App Store.

Apple's iPad Units Sales fell from 71 million units in 2013 to about 68 million units in 2014, amid slowing growth in the tablet market. The metric fell significantly lower to about 55 million units in 2015,likely as Apple's large screen iPhones cannibalized sales, while they declined to about 45 million in 2016. The declines moderated in 2017, as Apple launched a lower-priced 9.7 inch iPad along with a new 10.5-inch model.

Chart: iPad Units Sold

Mac

What is being offered?

  1. The MacBook Pro is specifically designed for professionals and advanced consumer users.
  2. The MacBook is an ultra slim notebook
  3. The Mac Pro is specifically designed for creative professionals and business users.
  4. The iMac is targeted at general consumers, users who intend to use it for educational purposes.
  5. The Mac Mini is an entry-level computer intended for budget-conscious customers

Who is buying?

Individuals and enterprises.

Competitors:

HP, Dell, Lenovo

What buyers care about:

  1. Price
  2. Ease-of-use
  3. Size-and-weight
  4. Ease-of-keyboard use
  5. Picture and sound quality
  6. Battery usage
  7. Compatibility with different software

Apple's top selling points

  1. User friendly graphical user interface (GUI)
  2. Less battery consumption
  3. Works well with Apple's other devices such as iPhone and iPad
  4. Ability to run Windows software
  5. Compact size and light weight

Apple's weakness

  1. Mac desktops and notebooks are highly priced.

Mac Pricing

Mac Pricing represents the average price of a Mac Desktop.

The average Mac Pricing has largely stood at levels of between $1,250 to $1,300 between 2013 and 2016, although it increased to about $1,400 in 2018. Apple has been able to maintain pricing on account of its shift to more premium computers such as the iMac with Retina Display, the ultra-compact MacBook and MacBook Pro with Touchbar.

Chart: Mac Pricing

Mac Units Sold

Mac Units Sold represents the number of Mac computers shipped by Apple.

Apple's Mac shipments have risen from about 16 million units in 2013 to about 21 million units in 2015, as Apple was able to grow its shipments despite headwinds in the global personal computer markets. However, the metric declined in 2016, on account of the aging industrial design and a lack of meaningful upgrades on the company's flagship Macs. However, sales rebounded to about 19 million in 2017, as Apple upgraded its popular MacBook Pro and iMac computers. The number declined to about 18 million in 2018.

Chart: Mac Units Sold

Apple Watch, TV and Accessories

What is being offered?

Apple's other products segment includes revenues from

  1. Apple TV
  2. Apple Watch
  3. iPod Touch.
  4. Beats Audio products
  5. Headphones and Other accessories

Who is buying?

Individuals buy directly

Competitors:

  1. Apple's competitors in the smartwatch space include Samsung, Xiaomi, FitBit, and Asus.
  2. Apple TV competes with the likes of Roku, Google Chromecast and Amazon Fire TV
  3. Apple's Audio products compete with Bose, JBL, Logitech and others

What buyers care about:

  1. Price
  2. Ease-of-use
  3. Size-and-weight
  4. Battery life
  5. Design and features

Apple's top selling points

  1. Apple's accessories are easy to use
  2. Its accessories and wearables work well with other Apple products and services

Apple's weakness

  1. Apple's wearables and other accessories are typically pricier compared to the competition

Other Product Revenues

Other Product Revenues includes revenue from the sales of the Apple TV, Apple Watch, Beats products, iPod touch and Apple-branded and third-party accessories.

Apple's Other Product Revenues declined from about $10 billion in 2013 to about $8.4 billion in 2014, amid weaker sales of the iPod. However, the metric grew steadily since then to about $13 billion in 2017, on account of the acquisition of Beats in 2014 and the launch of the Apple Watch in early 2015.

Chart: Other Product Revenues

Apple Store and Other Services

What is being offered?

Apple's Internet services such as the App Store, Apple Music, iTunes, iCloud and Apple Pay. Revenues from Apple Care and licensing are also included in this segment.

Who is buying?

Apple's services cater primarily to iPhone, iPad, and Mac users. The company also offers the Apple Music service to Android users.

Competitors:

Internet companies such as Google compete with Apple in the cloud storage space. Streaming services such as Spotify and Amazon Prime Music compete with Apple Music. Apple's mobile payment service Apple Pay competes with the likes of Google's Android Pay and Alibaba's Alipay.

What buyers care about:

  1. Price
  2. Interface and ease of use

Apple's top selling points

  1. Tight integration with Apple devices and OS
  2. Apple's expertise in designing UIs

Services Revenues

Services Revenue represents the revenues from Apple's services including its iTunes Store, App Store, Apple Music, iCloud and Apple Pay. Revenues from the AppleCare extended warranty program are also included in this segment.

Apple's Services Revenue has increased from around $16 billion in 2013 to about $24 billion in 2016, driven by a growing installed base, higher sales at the App Store, and a growing number of paid subscriptions on Apple's platform. The number rose further to about $30 billion in 2017 and $37 billion in 2018.

Chart: Services Revenues