Yesterday, Apple released the results for its 2021 fiscal first quarter (which ran from September 27, 2020, to December 26, 2020, and did not actually include any days from calendar year 2021) and held a call with analysts to discuss the results. This is typically Apple's best quarter of the year because it includes holiday sales. This year, it was the best quarter in the history of the company, with revenue of $111.4 billion, up 21% from this time last year. (And this time last year, Apple posted record results which were 9% higher than the year before.) Has any other company ever reported revenue of over $100 billion in a single fiscal quarter? I honestly don't know, but I certainly couldn't find any evidence of it when I did some Google searches on this. But as impressive as this number is, the real reason that I report on Apple's quarterly earnings is not to report on the numbers — let the folks at places like the Wall Street Journal focus on that — but to report on the financial call that Apple holds with analysts every quarter, during which Apple always seems to have something interesting to say about the iPhone and iPad. If you want to get all of the nitty gritty details, you can download the audio from the announcement conference call from iTunes, or you can read a transcript of the call prepared by Seeking Alpha, or a transcript prepared by Jason Snell of Six Colors. Apple's official press release is here. Here are the items that stood out to me:
iPhone
- iPhone revenue during the quarter was an all-time record $65.6 billion, compared to almost $56 billion this time last year, a 17% increase.
- The number of iPhones that are actively being used around the world is now over one billion. This means that there are more people now using an iPhone than at any time in history.
- Apple CFO Luca Maestri said that there has been high interest in the iPhone 12 Pro and iPhone 12 Pro Max, and that supply has been limited as a result, but supply is now starting to catch up with demand for those high-end iPhones.
iPad
- iPad revenue during the quarter was $8.4 billion, compared to almost $6 billion this time last year, a 41% increase.
- Apple did not announce the number of iPads that are actively being used right now, but Maestri did say that Apple's installed base of active devices reached all-time records "in each of our major product categories," and the iPad is one of those categories. So this means that there are now more people using an iPad than ever before.
- Apple CEO Tim Cook said that about half of the people buying an iPad are buying their first iPad.
- This was not a record quarter for iPad revenue because iPad sales were higher around 2013-2015. For example, in the 2014 fiscal first quarter (i.e. the end of 2013), Apple sold 26 million iPads (which was a record) and saw iPad revenue of $11.5 billion — which I believe was an all-time record. But for over five years, iPad revenue has been much lower. I'm glad to see iPad sales going up again because that should encourage Apple to focus on the iPad even more. For those of us who consider the iPad a critical part of their work life (not to mention a much-appreciated device for entertainment), I would love to see Apple do even more with the iPad.
- Cook said that the big increase in iPad (and Mac) revenue during the past quarter reflects "the continuing role these devices have played in our users’ lives during the COVID-19 pandemic."
Other
- Cook said: "Wearables, home and accessories grew by 30% year over year, driven by significant holiday demand for the latest Apple Watch, our entire AirPods lineup including the new AirPods max, as well as the new HomePod mini." I know that in my own home, I bought my wife a new Apple Watch for Christmas and she bought me a new HomePod mini.
- Cook said that if Apple's wearables business (AirPods, Apple Watch, etc.) was a stand-alone business, it would be a Fortune 120 company.
- Cook also noted: "The winter holiday season is always a busy time for us and our products, but this year was unique. We had a record number of device activations during the last week of the quarter. And as COVID-19 kept us apart, we saw the highest volume of FaceTime calls ever this Christmas."
- If you count up all of the different ways that people can pay Apple for a subscription to something (an app, a service like Apple Music, etc.), Apple now has a record 620 million paid subscriptions, which is 140 million higher than this time last year.
