It’s not just you: Apple’s hardware is more expensive than ever. That may be bad news for your wallet, but it’s a trend that’s likely to continue — because it’s working.
The company, which became the first ever to reach a $1 trillion market cap in August, just reported another record quarter, with revenue up 20 percent from the same time last year. And, yet, iPhone sales weren’t as strong as expected, with the company selling about same number of iPhones as this time last year.
That the company can set new revenue records with iPhone sales remaining relatively flat shows exactly why Apple is charging more for its devices than ever. Quite simply: it can make more money while selling fewer products.
Yowza. @Apple’s iPhone average selling price was $793 in Q4, up from $618 a year ago. The company’s strategy in boosting iPhone prices is working.
Apple further reinforced the idea that sales of its biggest products may not continue to grow significantly when executives revealed the company will no longer divulge how many iPhones, Macs, and iPads it’s selling each quarter. Instead, Apple will provide revenue totals for its product categories, which makes it more difficult to understand how well a given gadget is selling.
Investors and analysts were not happy with the news, as they’ve long relied on these sales metrics to judge the company’s performance. But Cook and other executives said they no longer believe unit sales metrics are as useful as they once were.
“I can assure you it is our objective to grow unit sales for every product category that we have…but a unit of sale is less relevant today than it was in the past,” said Apple CFO Luca Maestri on the earnings call.
Investors, though, weren’t convinced by the reasoning (and critics were quick to point out the convenience of this narrative coming at a time when iPhone sales are relatively flat). Apple stock fell more than 6 percent in after-hour trading following the company’s earnings report, briefly putting Apple standing as the first $1 trillion company in jeopardy.