What the new iPhone 16 could mean for Apple revenue: Chart

As Apple (AAPL) unveils the iPhone 16 alongside the new generation of Apple devices, Julie Hyman compares the last decade iPhone revenue with Apple's total revenue, weighing in on what iPhone sales in a new upgrade cycle could bring to the table.

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This post was written by Luke Carberry Mogan.

Video Transcript

Apple having its much anticipated iPhone 16 event today.

But how much do iPhone sales make up?

Apple's total revenue?

Yah finances.

Julie Hyman joins me now with a closer look.

The short answer is a lot.

Uh, Apple is still quite reliant on that Apple iPhone revenue.

It's also profitable project, UH, product and high margin, particularly with these newer, higher margin phones.

So if you look at the iPhone revenue through the years here you go all the way back to 2014.

It was right around $100 billion now in 2023 that had just about doubled to $200.6 billion.

And as you can see, there have been ups and downs some years.

In fact, we saw a bit of a decline last year in that iPhone revenue.

But if you look at it relative to overall, it's remained pretty consistently at least around half of Apple's overall revenue.

It peaked, by the way, at about 66%.

That was back in 2015, so that was the biggest proportion since then.

Of course, we've seen Apple introduce new products of like the watch, for example, and of course, beef up its services business as well, so that now makes up a much larger proportion now as to whether this new iPhone 16 is going to be a big driver of revenue and profitability, for that matter.

We talked earlier to be the Heron about that, and he thinks this will power a refresh cycle.

The base iPhone 16 is probably the best base iPhone they've ever made, which could actually, very interestingly, lead to a stronger cycle for the base model where this is.

Actually we've actually noticed a a mix shift the last couple of years to the pro, And I think if that happened, if this ageing base does more opt for iPhone 16, Um, we might see more of that mix shift.

Either go toward iPhone 16, which again is not something we've seen before.

And, um, we'll see a stronger, uh, stronger sell cycle for that, which again might impact a SP slightly so a S P's average selling prices again.

So that would help potentially the profitability for Apple, uh, and those margins, By the way, overall analysts are project projecting revenue for the full year of $390.4 billion.

That would be about a 2% increase over 2020 three's revenue.

And of course, Josh, a lot of that's gonna be iPhone sales.

Yeah, it was interesting to hear Ben Ben talk about you heard him say that ageing base right there.

And just to put a number on that, I was talking to Gene Munster.

Who, You know, long time Apple analyst Munster estimate there are roughly 700 million active iPhones out there.

They are at least three years old, which is just an incredible number.

It's part of the reason, uh, Munster and I think Ben there, too, saying some relative optimism because the bull case in part just resting on Listen, the iPhone 16.

So they bet will be compelling enough to get a lot of those people to upgrade.

And and it's whether the Apple Intel that a I offering is gonna be compelling enough.

You know, I was just talking to Josh Schafer about this in the newsroom, this question of whether it will be enough, and I think that at this point, we just don't know the answer to that.

Uh, you know, when they start rolling this out it gets in people's hands.

Word of mouth starts to spread.

Critics come out and review the product.

Not necessarily the phone, but all of those a I products.

Maybe Then we'll start to see, uh, some traction here, and we'll get a better feel for what demand is gonna be like.

Yeah, part of it is, you know, you listen to those Apple executives.

I think part of their job today was to make the case to really explain to the millions of people.

And it really is millions of people who turn into this event explain.

OK, these are these A. I features and really explain to them why they're important.

Why they're excelling.

You know why you need to upgrade.

As you said, Julie, we'll have to wait and find out.

You know, whether they made their case as effective as they could have, We shall see.

All right.

Thank you, Julie.