Apple reports record Q2 revenue of $89.6B, up 54% YoY, net income of $23.6B, up from $11.2B YoY, iPhone sales of $47.9B, up from $29B YoY

Revenue up 54 percent to new March quarter record — Services and Mac revenue reach new all-time high — Apple today announced financial results …

Apple 2021-04-29

Context & Ripple Effects

Apple’s 2019 reporting paired nearly flat total revenue with a decline in iPhone sales, even as Services set a quarterly record. This quarter reverses the hardware picture while also putting Services and Mac at all-time highs, making the growth broader than a single product line.

The subsequent June-quarter results kept Services growing even as iPhone sales stepped down from this quarter’s level, reinforcing the significance of Apple’s non-iPhone revenue base.

First-order effects

Apple enters the next quarter with substantially higher iPhone revenue and record Services and Mac revenue, strengthening the earnings contribution from its core device businesses and attached services.
iPhone buyers and Mac buyers are the immediate sources of Apple’s expanded revenue base, while Services reaches a new high alongside those device sales.

Second-order effects

A larger iPhone sales quarter expands the pool of Apple customers that can generate recurring Services revenue, a connection reflected in Services’ continued growth in the following quarter.
Apple’s product mix becomes less dependent on holding iPhone sales at this quarter’s peak: later results show iPhone revenue lower while Services sales continued to rise.

Third-order effects

The contrast with 2019’s iPhone decline alongside record Services points to a more durable Apple model in which device cycles seed higher revenue per active device rather than solely determining quarterly growth.
If Services continues to grow through differing iPhone quarters, Apple’s competitive advantage increasingly rests on monetizing its installed device base across hardware cycles.

The trend: Apple is pairing renewed iPhone-led growth with a larger Services business, shifting more of its performance toward revenue generated after device sales.

Discussion

@greengart Avi Greengart on x
My goodness: it's not services (which are way up YoY) or wearables (which are also way up). It's iPhone, iPad, and Mac (way way way up). $AAPL https://twitter.com/...
@patrickmcgee_ Patrick McGee on x
*breaking* @Apple results: Revenue soared 54% to $89.6bn, far exceeding already-elevated forecasts of $77bn. Net profits up 110% to $23.6bn. In six months, Apple has earned $200bn+ in revenue, more than all of 2014 or any year prior
@patrickmcgee_ Patrick McGee on x
This isn't just about an “easy comparison” to last year. @Apple has never, before today, recorded more than $65bn in a non-Christmas quarter. Today it posted ~$90bn. https://twitter.com/...
@neilcybart Neil Cybart on x
Tim Cook: We saw double-digit percentage increases for both people new to iPhone and upgraders during 2Q21. We saw a record number of iPhone upgraders for a March quarter last quarter.
@jyarow Jay Yarow on x
Amusing that the services and wearables were the laggards this Q. (They're supposed to be the growthy ones.) https://t.co/wT1vzuuj1J
@patrickmcgee_ Patrick McGee on x
Total iPhone sales were up a staggering 66%, bringing in $47.9bn — or 54% of all revenues — as consumers the world over upgraded their handsets to the first lineup of 5G-enabled iPhones. https://twitter.com/...
@neilcybart Neil Cybart on x
Here's the challenge for Tim Cook: You can't talk up sales growth rates too much because Apple is not going to be able to sustain some of these growth rates in the coming quarters (due to more difficult year-over-year compares).
@stevekovach Steve Kovach on x
That's ninety billion dollars in share buybacks. As in the size of $SNAP's entire market cap. https://twitter.com/...
@srussolillo Steven Russolillo on x
Apple is a $2 trillion company by market cap that just reported 54% revenue growth. That is absolutely staggering. $AAPL https://www.wsj.com/...
@jacknicas Jack Nicas on x
Apple just reported absurd results. Remember, this is just for January through March: -Profits more than doubled to $23.6 billion. -Revenue up 54% to nearly $90B. -iPhone sales up 66% to $48B. -Mac sales up 70%; iPad sales up 78%. This company is already worth $2.3 trillion.
@techaltar @techaltar on x
@reneritchie For a company the size of Apple to have revenue up 54% is just mind blowing. Their yearly growth is more than the economies of entire countries at this point
@techaltar @techaltar on x
That's $31bn growth for a single quarter. Assuming a very oversimplified 4x$31bn for a year, Apple would have $125bn just in growth. For context, the GDP of the entire country I'm from, Hungary, is ~$176bn. https://twitter.com/...
@firt Maximiliano Firtman on x
It's still not enough to document Safari's features 😛 https://twitter.com/...
@mgsiegler M.G. Siegler on x
Perhaps related, the iPhone business alone is slightly larger than all of Microsoft — even now in non-holiday quarters. ...and grew 3 times faster. 🤯
@neilcybart Neil Cybart on x
Apple reported $57 billion of free cash flow over the past six months. Free cash flow can be thought of as money left over at the end of the day but prior to buyback / dividends. That's a crazy total. Apple's free cash flow had been trending at $60 billion for the entire year.
@lanceulanoff Lance Ulanoff on x
What a difference a year makes. Last year at this time, Apple iPhone sales were $28.9B. This year, on the strength of the 5G iPhone 12, $47.9B. Talk about pent up demand. #AppleEarnings https://www.apple.com/...
@jsnell Jason Snell on x
I don't know how we shift “this was another record Apple quarter” into a higher gear, but that phrase doesn't do this quarter justice... https://sixcolors.com/...
@bleedsixcolors Six Colors on x
The iPhone put in its best non-holiday quarter performance ever, with $47.9B in revenue, up 66 percent over the previous second quarter. https://twitter.com/...
@patrickmcgee_ Patrick McGee on x
The only area where Apple is failing is in its quest to achieve a cash-neutral position on its balance sheet. To that end, Apple announced a $90bn share buyback programme. https://twitter.com/...
@dmoren Dan Moren on x
70 percent growth for the Mac! M1 strikes again! https://twitter.com/...
@tomwarren Tom Warren on x
Apple's nearly $90 billion a single quarter of revenue really puts the 30% / 15% cut into perspective. That cut percentage will be particularly interesting soon. https://twitter.com/...
@benbajarin Ben Bajarin on x
Apple's answer to the question of continued sustainability is simply this: A history of shipping great products = continuing to ship great products. Their brand equity is in the upper echelon.
@counternotions Kontra on x
Steve Jobs era gave us the $50-billion/YEAR Apple. In the Tim Cook era, the last two QUARTER revenues exceeded $111 and $89 billion. The Law of Very Large Numbers.
@lorakolodny Lora Kolodny on x
crazy growth for such a big company. feel like pandemic life is still driving some ipad and wearable sales? i do. https://twitter.com/...
@munster_gene Gene Munster on x
Putting Apple's past two quarters into perspective: Apple's combined EPS for FY21's first two quarters is $3.08 That compares to FY20 full year EPS of $3.28 Company has earned 94% in 6 months of what they did in 12 months last year.
@asymco Horace Dediu on x
This graph says it all for growth: https://twitter.com/...
@mattrosoff Matt Rosoff on x
Perhaps the biggest surprise for longtime $AAPL watchers: Gross margin came in at 42.5%. It's almost always 37%- 38%. https://twitter.com/...
@alecstapp Alec Stapp on x
Tim Cook has 10x'd Apple's market cap since becoming CEO 🤯 https://twitter.com/...
@stevekovach Steve Kovach on x
Some wild stats from $AAPL's quarter: -$90 billion in share buybacks -Gross margin up to 42.5% -iPad sales up 78.9% -Mac sales up 70% https://www.cnbc.com/...
@asymco Horace Dediu on x
Customer satisfaction is at 99% for the iPhone 12 family (US data).
@reutersbiz @reutersbiz on x
Apple said sales in China nearly doubled and results topped analyst targets, led by $6.5 billion more in iPhone sales than predicted $AAPL https://twitter.com/...
@mgsiegler M.G. Siegler on x
One more thing: Apple's business *minus* the iPhone is now the *exact* same size as Microsoft: both had $41.7B in revenue last quarter. 😲
@stevesi Steven Sinofsky on x
Apple reported record revenue for the January-to-March quarter because of surging sales of premium iPhones and pandemic-induced buying... https://www.wsj.com/... // Apple holds 7 of the 10 largest earnings quarters on record and 13 of the top 20. Will prob hold 8 of 10 next q.
@jacknicas Jack Nicas on x
Apple just reported absurd results. Remember, this is just for January through March: -Profits more than doubled to $23.6 billion. -Revenue up 54% to nearly $90B. -iPhone sales up 66% to $48B. -Mac sales up 70%; iPad sales up 78%. This company is already worth $2.3 trillion.
@ianlopuch Ian Lopuch on x
Hi @Apple, thank you for an outstanding quarter with 54% year-over-year revenue growth! 🚀 Moreover, as an ordinary person who pays bills with #dividends, thank you for the generous 7% #dividend increase! 🙏 I am grateful. (Disclosure: I am long $AAPL) https://www.apple.com/...
@levie Aaron Levie on x
Apple growing 54% YoY at $90B scale. My brain: https://t.co/sgznAJZgJ8
@teroterotero Tero Kuittinen on x
2Q consumer spending in America will beat all current estimates. These Yankees are out of control. 8% GDP growth for all summer long? https://twitter.com/...
@patrickmoorhead Patrick Moorhead on x
I'd call iPad +79% and Mac +70% growth “eye-watering”. There's a supply chain story somewhere in here. Others having a hard time getting supply of the basics like displays and USB ports. https://twitter.com/...
@karlconrad Karl Conrad on x
Apple with a 54% increase in revenue. For a company of its size... that's pretty incredible https://www.apple.com/...
@neilcybart Neil Cybart on x
When you hear and see these eye-popping growth rates for iPhone etc., it is important to remember Apple's March 2020 was an awful month as lockdowns took over. The easy year-over-year compare doesn't explain all of Apple's strength though.
@danieleran Daniel Eran Dilger on x
Who could have imagined that Apple's “super cycle” would finally arrive, stoked not by 5G but by a global pandemic! Last year I wrote why $AAPL would survive a pandemic downturn better than its Android peers. Critics claimed Apple was finally going to die: WhO nEeDs LuXuRy NoW?
@stevekovach Steve Kovach on x
And they didn't even have to sell Bitcoin! https://twitter.com/...
@munster_gene Gene Munster on x
1) Apple reported spectacular 15% revenue upside, equating to a $12B revenue beat. Strength came across the board. Under normal circumstances, shares of $AAPL would be up 10%+ reporting this kind of upside. The reason why it's only up 3% is the question about sustainability.
@patrickmcgee_ Patrick McGee on x
iOS is eating into Android in the world's biggest market: Apple CFO Luca Maestri told me that two iPhone 12 models were the two top-selling smartphones in China last quarter. Also, 4 of the 6 most popular phones were iPhones.
@daniel_rubino Daniel Rubino on x
It's going to be interesting to see if Apple can sustain this. It's safe to assume that many MBP purchases are current customer upgrades, but it's also clear in markets like China, Apple is making big inroads for first-time buyers. https://www.cnbc.com/... https://twitter.com/...
@jsnell Jason Snell on x
this one's bananas - in terms of revenue, the three best quarters of the Mac's 37-year existence are the three most recent ones. https://twitter.com/...
@rustybrick Barry Schwartz on x
I knew that purchase of the Apple Air Tags four pack would help with Apple's revenues https://twitter.com/...
@stephennellis Stephen Nellis on x
.$AAPL CEO Tim Cook says Apple chip shortages are centered on “legacy nodes.” Those are the same older-technology chip factories hobbling the automotive industry, including slashing Ford $F production in half. Read @benklayman for the Ford story - https://www.reuters.com/...
@munster_gene Gene Munster on x
2) While that's bad news in the near term, the good news is Mac and iPad will eventually regain supply, and should benefit for years as businesses and students equip for the hybrid status quo.
@munster_gene Gene Munster on x
1) We're working on our Apple model and factoring in Cook's comment to expect a $3-4B supply constraint headwind to Mac and iPad in June. Looks like we'll be lowering our numbers in those segments by about 15%.
@stevesi Steven Sinofsky on x
Apple: Mac revenue: $9.1B, +70.1% YoY iPad revenue: $7.8B, +78.9% YoY Insane. Biggest Mac quarter ever. It shows just how loyal/strong the customer base is in the desire to move to M1. And this quarter has the new iMac. And M1 iPad...
@neilcybart Neil Cybart on x
Half of people buying iPads and Macs are new to the product categories. It's been that way for a while now and it's still a shocking statistic.
@greengart Avi Greengart on x
@BenBajarin @Bajarin @AAPLTree So Apple was able to secure all the 5nm it might need for its SoC because it bought up all the supply well in advance, but can't get enough disk controllers or display drivers etc. due to cross-industry demand?
@neilcybart Neil Cybart on x
Apple Services gross margin: 70.1%. https://twitter.com/...
@patrickmcgee_ Patrick McGee on x
660m paid subscriptions - for a mostly hardware company - is insane. That's roughly two-thirds of all iPhone owners paying Apple monthly fees on a growing array of services.
@neilcybart Neil Cybart on x
Apple: Our Services business is being boosted by our retail stores being reopened. AppleCare momentum is back. Advertising is coming back too.
@asymco Horace Dediu on x
Apple added 40 million new subs to a total 660 million paid subscriptions. Up 145 million from year ago. Doubled from 2.5 years ago.

Chronicles