Apple’s Ensemble Act Is Working Again

It’s as good a time as any to talk about Apple Inc. without the iPhone.

No, the iconic smartphone isn’t going anywhere. In fact, Apple just reported Tuesday afternoon that iPhone revenue totaled $39.6 billion for its fiscal third quarter ended June 26, up 50% from the same period last year. That represents the best growth the iPhone has seen in six years for what is typically its weakest seasonal quarter, as many buyers begin waiting to make purchases ahead of new devices that typically debut in the early fall.

Wall Street expects Apple to close its fiscal year in September with record iPhone revenue of nearly $187 billion, which would make its phone segment alone the 10th largest business on the S&P 500. But a funny thing has happened over the past few years: The iPhone has also become a notably smaller part of Apple’s business. At the smartphone’s last sales peak in fiscal 2018, the iPhone represented 62% of the company’s total revenue. For the trailing 12-month period ended in June, that number was 52%.

For that performance, Apple can thank its supporting cast across the board. Sales of iPads, Macs and wearables like the Apple Watch and AirPods have boomed over the past three quarters, while service revenue growth also picked up. Macs and iPads were definitely helped by the work-from-home trend sparked by the pandemic, but Apple also made some timely and notable updates to both lineups—including new in-house chips for several of its Mac models. Combined Mac sales for the last three quarters have totalled $26 billion—up 33% from the same period last year.

That’s a helpful trend for Apple as it heads into what will likely be a much more subdued sales cycle for the iPhone. Last year’s iPhone 12 models, which featured a new design and 5G connectivity for the first time, sparked a major upgrade push. Analysts estimate that Apple sold 186 million iPhone units for the nine-month period ended June, up 26% from the same period last year, according to consensus estimates from Visible Alpha. But Apple typically follows major upgrades with minor ones. Analysts expect iPhone unit sales to be flat in Apple’s 2022 fiscal year following a 22% surge for the current one.

The big question is whether the supporting acts can keep stepping up. The remote-work boost from the pandemic is already fading, as evidenced by a notable slowdown in PC sales during the second quarter, as reported by market-tracking firms IDC and Gartner. Apple is also still contending with the chip shortage. Chief Financial Officer Luca Maestri said on Tuesday’s conference call that the company expects supply constraints to worsen in the September quarter relative to June, mostly affecting the iPhone and iPad.

Still, Mr. Maestri projected the company will deliver “very strong double-digit” revenue growth for its fiscal fourth quarter. With a market value of nearly $2.5 trillion and a stock still at a relatively high multiple of about 28 times forward earnings, Apple can’t afford to have any of its businesses start phoning it in.

When people talk about making a seachange, chances are this is the kind of property on the NSW South Coast that they have in mind.

Open for inspection for the first time this Saturday, 24 Point Street Bulli offers rare absolute beachfront, with never-to-be-built-out north facing views of the ocean. Located on the tip of Sandon Point, this two-storey property is a surfer’s dream with one of Australia’s most iconic surf breaks just beyond the back wall.

On the lower floor at street level, there are three bedrooms and two bathrooms, including a family bathroom and an ensuite in the master suite. A fourth bedroom is on the upper floor, along with the main living area, and is serviced by its own bathroom.

While this would make a spectacular holiday home, it is well equipped for day-to-day living, with a spacious gourmet kitchen and butler’s pantry set into the articulated open plan living area on the first floor. A separate media room to the street side of the property on this level provides additional living space.

Every aspect of this property has been considered to take in the light and views, with high ceilings internally and spacious, north facing decks on both levels to take in views of rolling waves. If the pull of the ocean is irresistible, it’s just a 100m walk to feel the sand between your toes.

The house is complemented by a Mediterranean, coastal-style garden, while the garage has room for a workshop and two car spaces.

An easy walk to Bulli village, the property is a 20 minute drive from the major hub of Wollongong and just over an hour to Sydney.

Open: Saturday August 6 2pm-3pm Auction: Saturday September 3 Price guide: N/A but expected to exceed $5.3m paid in March for 1 Alroy Street

Contact: McGrath Thirroul – Vanessa Denison-Pender, 0488 443 174

Apple’s Ensemble Act Is Working Again

Tech giant’s iPhone dependence has shrunk, as iPad, Mac, Wearables and Services all pick up growth.