A snapshot of Apple’s installed base

This is what 1.4 billion active devices looks like.

From Horace Dediu’s A Billion Users, posted last week on Asymco.com:

In the latest Apple Earnings report, Apple announced a few details that are relevant to the forecast of the business:

  • The global active installed base for iPhone reached an all-time high at the end of December, surpassing 900 million devices. This represents growth y-o-y in each of five geographic segments, and growth of almost 75 million in the last 12 months alone
  • There are now over 360 million paid subscriptions across the Services portfolio, an increase of 120 million versus a year ago. Apple expects to surpass 500 million in 2020.
  • The installed base grew to 1.4 billion devices by the end of December.
  • This includes all-time highs for each of the main product categories and all five of their geographic segments.

I added all these data points to the previous reported figures related to installed base, subscriptions and Services revenue.

Click to enlarge. 

My take: Note the gap between active devices and paid subscriptions. I can relate to that!

10 Comments

  1. Gregg Thurman said:

    After the leap in iPhone revenue generated by the launch of iPhone 6, Apple revenue has been on a steep upward trajectory even though iPhone revenue has essentially been flat since that launch.

    The cause of that steep trajectory can only be attributed to two thing: higher prices for iPhones (vs increased unit sales) and growth in Services (Apple Music, iCloud, iTunes sales and Subscriptionsand Wearables) and Home (Airpods, HomePods and Apple Watch).

    There is just so far Apple can increase iPhone ASPs (I think ASPs will peak next year). Services and Wearables is where I believe AAPL investors should be focused, and not on salacious issues that MAY involve the use of Apple products, or the possibility such salacious subject was obtained by a security breach of said products, neither point having been claimed by the participants.

    1
    February 8, 2019
    • David Drinkwater said:

      “The cause of that steep trajectory [“in Apple revenue” appears to be the implication] can only be attributed to two thing: higher prices for iPhones (vs increased unit sales) and growth in Services (Apple Music, iCloud, iTunes sales and Subscriptionsand Wearables) and Home (Airpods, HomePods and Apple Watch).”

      I don’t agree. I think the steep trajectory can be far simpler than pricing: I think it is easily attributed to growth in services. (Gregg, i tseems that your argument is different that what I read earlier, so I apologize if I edited it while reding it.) I think people are forgetting the simple calculus: services revenue is directly proportionate to installed base. As such exactly static iPhone ownership should represent a constant *rate* of services revenue. A constant rate of iPhone sales should equal a constant *slope*/increase to services revenue. And iPhones are continuing to sell. Increasing rate of iPhone sales should look like acceleration of services sales.) Some portion of sales is balanced by actual retirement of i Phones. But if you remember that old iPhones die hard, you realize that probably new sales represent three scenarios:

      1) new iPhone user,
      2) iPhone user who passes old phone to some other user, and
      3) the quiet cataloguing of a beloved used iPhone for the mantlepiece or the long term collection.

      1) is pure gain in number of iPhones (and services) sales
      2) is gain in new iPhone sales and addition to installed base
      3) is new iPhone sales and continued use of iPhone services

      All three represent iPhone sales. I suspect that only (3) represents flat services.

      The unspoken (4) would be transition to a different handset supplier. I’m sure it happens occasionally, but as long as Apple’s installed base continues to grow, I don’t really care.

      0
      February 8, 2019
      • Gregg Thurman said:

        But if you remember that old iPhones die hard, you realize that probably new sales represent three scenarios:

        1) new iPhone user,

        A different view of an increasing user base. I like it.

        If we assume the iPhone 6 model was the start of extended ownership, and Apple continues iPhone unit sales at the same annual level each year thereafter, then new unit sales are net increases to the iPhone installed base (less unit sales from 5-6 years ago).

        A. Services revenue goes up as installed base increases.
        B. Services revenue goes up as Apple adds more Services offerings.

        Dominating the over $400 smart phone market and selling to the top demographic Services revenue is going to increase double digit (YoY) for a long time.

        What’s not to like about that?

        I knew this but you articulated it better than I.

        1
        February 9, 2019
  2. Gregg Thurman said:

    I suspect you’re referring to the previous article’s comments on the attempted blackmail of Jeff Bezos.

    That I am.

    0
    February 8, 2019
    • Jonathan Mackenzie said:

      The story isn’t salacious. The Enquirer used the threat of publishing salacious photos to blackmail Bezos. But the blackmail is not salacious. It’s despicable. And Bezos’s response to AMI is not salacious, it’s heroic.

      1
      February 8, 2019
  3. Gregg Thurman said:

    PED’s headline strongly suggests salacious content with the term “sexts” included in it. The alleged selfies, as described, are salacious. Hence my use of the descriptor salacious. If the selfies weren’t salacious there would be no interest in this story.

    0
    February 8, 2019
    • Jonathan Mackenzie said:

      Did you read the blog post? I skipped over the description of the pictures, just skimming a couple to understand the nature of what they were threatening to publish. I think a more interesting story is dynamic between Bezos and Trump and the obvious connection between Pecker and Trump.

      And more interesting still is how the literally richest man in the world can have this kind of dirt dug up from his digital life. He either wasn’t being careful about how he texted and sent photos, which seems cavalier enough to be plausible (there’s a certain carelessness that some billionaires seem to show about their lives — probably comes from having everyone tripping over themselves to remove barriers from your life wherever you go), or he had every expectation that his privacy was being protected.

      I’m not going to clutch my pearls because someone is talking about sexting. There are much larger components to this story than just the seedy stuff. You could argue (and have) that there’s no Apple angle, which I think you’re right in a literal sense. But doesn’t this whole thing touch (at least tangentially) some issues which are very much in Apple’s wheelhouse?

      There’s the theft of photos (harkening back to the Jennifer Lawrence photos that had some blaming Apple).

      There’s data privacy.

      There’s the possible de-encryption of data by a security service (or there’s at least a newsworthy hack of digital data).

      If the claim that some government agent or agency was involved in obtaining this data is true, there is a story about what Homeland Security can and get to from your digital device.

      Jeez, just imagine if the FBI or NSA or anyone else did see this kind of thing for whatever reason. He’s the richest man in the world. Would that information ever remain professionally discreet if no crime was being committed. or would it end up in the hands of the National Enquirer?

      But I know just because we can imagine it doesn’t mean that it’s true. This data could have come from anywhere. Maybe we’ll find out. But on the whole this seems like an important story about living a 21st century life and the ways your private digital life may be used against you. This is a tech story at its core. isn’t it?

      1
      February 8, 2019
  4. Turley Muller said:

    I got so many damn subscriptions it’s pitifull. Well… I like it.

    0
    February 9, 2019

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