Apple did hit a bump in the road in April, at the end of its second quarter (and right in the middle of the lockdowns from the novel coronavirus). Apple reported iPhone sales of $28.96 billion in the second quarter of FY2020, compared to $31.05 billion in Q2 2019. But, by the end of Q3, year-over-year iPhone sales rebounded. Apple's Q3 2020 reports $26.42 billion this year, compared to $25.9 billion in the same quarter last year.
So, revenue is going up, a trend Apple has generally enjoyed since the launch of the iPhone. But what about unit sales? That's where our new chart gets interesting. Taking data quoted from IDG in Bloomberg, I dropped iPhone unit sale estimates into Excel and did some tinkering.
This first chart shows iPhone sales as they are normally depicted. The scale starts at $0 and goes up to $250B. The red line does indicate a declining unit sales trend, which must be moderately alarming from Apple's perspective.
But now, let's take the same chart and isolate the changes. In this version, I made the overall chart taller, which accentuates value differences. I also focused on the values in play, so I set my scale to start at 130 and ended it at 220. These two changes strongly reinforce the unit sales drop over the past few years, as shown by the red line.
Additionally, as the green line shows, Apple's iPhone currently reported unit sales are actually lower than every year since 2013.
But here's another chart that really tells the tale; this is a chart that shows the range between the lowest-priced iPhone introduced in the specified year and the highest-priced iPhone introduced in that same year.
As you can see, the top end has been steadily rising. In 2016, the top price (in US dollars) was $969. You couldn't buy an iPhone for more. In 2017, that jumped to $1,149 when Apple introduced the iPhone X. In 2018, the XS Max soared to $1,449. That top-end stayed the same in 2019, at $1,449.
In three years, from 2016 to 2018, Apple's top-end price more than doubled. Since many Apple buyers succumb to the Apple reality distortion field and like buying high-end, fully-equipped phones, that's going straight to Apple's bottom line, despite the reduction in actual units sold.
As for the future, Apple is expected to introduce 5G models later this month. All that extra hardware has got to cost. Additionally, the Bloomberg article I cited earlier shares the rumor that Apple is expected to introduce a 6.7-inch phone, the largest it has ever produced.
I'm betting the addition of 5G, the large 6.7-inch screen, the possible addition of LIDAR, and, of course, the magical unicorn dust that Apple ships in every new iPhone will all conspire to boost the top-end price. I wouldn't be surprised if you saw $1,799 or even -- hang on, this is gonna hurt -- $1,999.
So, there you go. The charts show what we've known in more extreme light. Apple is losing new iPhone users at a drip-drip-drip pace, but the users it's keeping are spending more. And that doesn't even include what they spend on all the AirPods, Macs, iPads, and Watches that are sealed with dragon's breath and come in special white boxes enchanted by elves.
Correction: The first chart was updated with proper 2015 data. Thanks to eagle-eyed readers for pointing this out.