Apple can’t seem to stop printing money. Over the past couple of years, Apple has eliminated the headphone jack from new phones, removed Touch ID and the home button, and significantly raised the prices on new models. Despite these moves, Apple just posted another record quarter. Appleinsider breaks down the important numbers.
“The average selling price (ASP) of the iPhone is $793, up from the $617.99 ASP from one year ago. This continues a pattern seen in earlier quarters, with the main ASP driver being the premium pricing of the iPhone X, iPhone XS, and iPhone XS Max. Sequentially, iPhone ASPs are up substantially from the $724 figure recorded in quarter three.”
When Apple introduced the iPhone X starting at $1,000, many industry watchers thought it was a mistake. Not only did Apple offer its most expensive phone ever last year, it kept more of the older models on the market and made recent iPhones budget options.
Instead of going for the budget options, consumers are readily giving Apple their money. Rather than backtrack to a more familiar pattern, Apple presented the market with an even higher priced iPhone in the iPhone XS Max. Once again, ASP went up rather than down, proving that iPhone enthusiasts prefer the high-end models most of the time. Apple has yet to discover the upper range of what they can charge.
iPad didn’t fare nearly as well. It actually dropped year over year. The drop was not very large. But it stands out in a record quarter where everything else went up. This might explain Apple’s doubling down on the iPad this year at the October special event.
Not only did Apple increase the design, appeal, and technology of the device, they also increased the price by a substantial amount. If Apple sells only as many as they did this time next year, they will still have increased their iPad revenue.
Apple is hoping this year’s iPad Pro will bring in more PC switchers. At a $800 starting price for the smaller version, the iPad Pro is not a play for education. Apple is positioning it as a laptop replacement, and a high-end laptop at that.
Apple is projecting another huge holiday quarter. They expect between $89 billion and $93 billion for Q1. Companies like Samsung and Google are also enjoying profitable quarters. But keep in mind that much of Samsung’s profits come from selling Apple iPhone components.
Google currently pays Apple $3 billion to be the default search engine. Google makes so much money from iOS, they will reportedly be upping that to $12 billion next year. The iPhone is the rising tide that lifts a few of its closest competitors.