A new market intelligence study by Counterpoint Research firm reveals that Apple is expected to achieve another supercycle thanks to a large number of new buys of iPhone 14, Mac, and Apple Watch models.
Products experience high and low periods of demand called cycles. A super cycle is hit when the demand for a product continues to rise when it would have fallen during the normal cycles. Apple saw a supercycle at the launch iPhone 6 in 2014 when the larger display format attracted new buyers.
The company is experiencing the same influx of new buyers in three product segments, iPhone 14, Apple Watch, and Macs in 2022.
iPhone 14, Macs, and Apple Watch saw a large number of new buyers
Recently, Apple reported a $90.1 billion record revenue for Q4, 2022 with significant growth across products and services, except the iPad. Based on the latest earning call, the research firm states:
- iPhone 14 series drove up iPhone average selling price (ASPs) and new buyers.
Apple registered a record-high installed base number for active devices driven by a record number of upgraders as well as ‘double-digit’ growth of switchers to iPhones, indicating continued migration from Android to iOS.
Check out iPhone sales hit $42.6 billion record revenue with 10% growth in Q4, 2022 here.
- The launch of the new 13-inch M2 MacBook Air and MacBook Pro and improved supply improved Mac sales, significantly.
The installed base for Mac devices also reached an all-time high, attracting both upgraders as well as first-time Mac users.
More than half of the Mac purchases came from new users. This is crucial for Apple as it continues to attract the creator community and expand its footprint to a wider audience.
Check out Mac sales generated record revenue of $11.5 billion in Q4, 2022 here.
- Even with the new Apple Watch Series 8, SE and Ultra facing supply constraints, the smartwatch segment saw a large number of new customers.
There was growth in this category despite foreign exchange headwinds and loss of business in Russia. Notably, two-thirds of Apple Watch purchases came from new users.
Check out Apple Watch attach rate hits 30% in the U.S., higher ever for any half year here.
- Although Apple Services remained more exposed to risks, the higher install base of iPhone and other Apple devices shows an upward trajectory and possibly a supercycle for the segment.
Despite being significantly affected by foreign exchange headwinds, the segment’s quarterly revenue rose 5% YoY to $19.2 billion. It accounted for 900 million paid subscriptions, which increased by 155 million in the last 12 months.
In conclusion, the report states that the tech giant’s firm grip on its ecosystem enables it to manage economic headwinds. Thus, it is likely to achieve a new supercycle with continuous growth.
Overall, Apple’s strong grip over its user base continues to act as a growth engine, while its ‘walled garden’ approach builds further stickiness and brings in new users across its ecosystem. The current macro headwinds remain a temporary hurdle in the face of a longer-term growth supercycle as the company’s installed base continues to set new records.
Even after the launch of 5G-enabled iPhone models much later than its Android competitors, Apple achieved a 5G supercycle with the launch of the iPhone 12 in 2022 and it continued with iPhone 13 in 2021 the following year.
