Saturday, February 6, 2010

AAPL: $60 Billion In Revenue In FY '10

In early January I analyzed Apple's FY '09 revenue and based on the unit sales actuals for that fiscal year projected Apple's FY '10 revenue in the neighborhood of $60 billion. On January 27th, during the iPad introduction event, Steve Jobs stated, based on the company's 1st fiscal quarter results,  Apple is a $50 billion per annum enterprise. In my view, Mr. Jobs was being modest in his assessment. 
No matter the introduction of the new Apple iPad, Apple is on track for record revenue and earnings for the fiscal year ending in September. My $60 billion revenue projection is based on a simple extrapolation of Apple's first fiscal quarter performance with similar unit sales performances versus the prior fiscal year in each remaining fiscal quarter and using the 1st fiscal quarter's ASPs as a constant for the full fiscal year. 
As I've said several times on the Apple Finance Board, in FY '10 Apple will be a $60 billion revenue enterprise with the Apple iPad. Similarly, Apple will be a $60 billion revenue enterprise in FY '10 without the Apple iPad. It makes no difference in reaching that revenue threshold. 
Below are my unit sales projections for Apple's current fiscal year:
Mac units: 13.6 million units
iPhone Units: 41.48
iPod Units: 50 million units
iPad Units: To be determined
Benefitting Mac unit sales is an anticipated refresh of the Mac Pro line this quarter and comparatively strong iMac sales throughout the fiscal year.
The iPhone will see a doubling of unit sales over the prior-year periods. I'm anticipating continued strong unit sales growth in markets outside the US. The addition of a Verizon deal would boost total domestic unit sales even more. 
As Apple seeks to increase iPhone sales and market penetration, the prospects of a fully subsidized phone ("free" to the consumer at time of purchase) becomes an intriguing possibility. While this might ding ASPs slightly, the increase in unit sales and mid calendar year refresh of the iPhone line will push unit sales to a 100% growth rate. 
I'm anticipating a 10% unit sales decline for the iPod line for the remaining quarters of the fiscal year. Revenue may remain static due to the increasing percentage of iPod touch units of all units sold. 
I expect the Apple iPad to make a strong sales debut. While some suggest the Apple iPad may cannibalize some iPhone and iPod touch sales, there's also the possibility the Apple iPad will serve as a sales catalyst for other iPhone OS-equipped devices. 
No matter the sales the iPad may take from other Apple products, the iPad is being positioned to compete directly with Windows netbooks. Starting at $499, a much lower price point than most pundits expected, the Apple iPad is attractively priced to compete for sales and will ship in the millions of units this fiscal year. I'll add projections for the iPad in my revenue estimate updates. 


  1. DT
    Your 100% growth of Iphone units and your 26.5M units don't match. FY 2009 qtrs. 4363K, 3793K, 5208K, 7367K = 20,731K. 100% growth 41,462K You are projecting more like 28% growth overall and even less for the remainder of the fiscal year. Are you expecting the iphone to underperform the market in the latter half of the FY? You words say no but the numbers say yes.

  2. Thank you for catching the mistake on the iPhone units. I posted the 26.5 from my estimate of anticipated iPhone revenue for the fiscal year ($26.5 billion) rather than the unit sales estimate of 41.48 million handsets sold.