Apple's Services Achieve All-Time Quarterly Revenue Record

[MacRumors]

Apple today reported services revenue of $18.27 billion in the fourth quarter of its 2021 fiscal year, which is an all-time quarterly revenue record. The company's services revenue was up around 25% from $14.54 billion in the year-ago quarter.

Apple's services category includes revenue generated from the App Store, Apple Music, Apple Arcade, Apple Pay, Apple Card, Apple TV+, Apple News+, Apple Fitness+, AppleCare+, iCloud, iTunes Store, licensing, and more.

Cook told CNBC that Apple has 745 million paid subscriptions, ranging from Apple Music subscriptions to in-app subscriptions through the App Store.

"That's up 160 million year on year, which is up five times in five years," said Cook. "So it's been quite the growth cycle."

Apple's financial chief Luca Maestri said the company set September quarter revenue records across each of its services, and he said Apple's active installed base of all devices reached a new all-time high across all of its geographic segments.

Maestri said Apple's services category brought in $68 billion revenue in the 2021 fiscal year, which is nearly triple the company's services revenue six years ago.

Earlier this week, Apple announced that Apple Fitness+ subscribers can now use SharePlay to start a group workout or meditation with their friends while on a FaceTime call. Apple Fitness+ is also expanding to 15 more countries on November 3.

Apple reported overall revenue of $83.4 billion for the quarter, which ran from late June through late September of this year.

Article Link: Apple's Services Achieve All-Time Quarterly Revenue Record

 

[danielsutton]

How does AppleCare+ classify as a service?

 

[nutmac]

Services should decouple 3rd party App Store revenue. Apple having to lower commission and/or allow third party billing is inevitable and when it does, Services revenue will take a big hit.

 

[twintin]

How does AppleCare+ classify as a service?

As a payment service perhaps ?

 

[chucker23n1]

How does AppleCare+ classify as a service?

What else does it classify as? It's not a good. It's a service.

 

[entropys]

To the extent Apple TV+ means anything in those numbers, it certainly helped that the free period for a lot of people ended in this last quarter. Many would not have thought to turn that subscription off when it automatically started charging.

 

[neuropsychguy]

This profit helps Apple’s margins and allows Apple to keep hardware margins lower.

Edit: this should read: "Services profit and margins help Apple's overall margins remain in the historical 40% range while allowing Apple to have lower hardware margins."

 

[dguisinger]

This profit helps Apple’s margins and allows Apple to keep hardware margins lower.

.....
you seriously think they are keeping their margins lower because they are making money elsewhere?
when has there ever been evidence of that?

 

[dumastudetto]

This profit helps Apple’s margins and allows Apple to keep hardware margins lower.

Apple always strives to keep prices as low as possible for customers, while also maintaining margins high enough to continue investing in building the best-of-breed products and services we all love. It's a win-win for everyone.

 

[ghanwani]

You won't see an MR article on this.

https://twitter.com/i/web/status/1453829156127612942

 

[gaximus]

You won't see an MR article on this.

https://twitter.com/i/web/status/1453829156127612942

That graph is kind of useless, its excluding total debt. If they have less debt now than before, then the numbers are pretty meaning less.

 

[matrix07]

You won't see an MR article on this.

https://twitter.com/i/web/status/1453829156127612942

Net cash means nothing when their revenue and profit still going up. It's useless without other data.

 

[FightTheFuture]

.....
you seriously think they are keeping their margins lower because they are making money elsewhere?
when has there ever been evidence of that?

You wouldn’t find evidence in that, why would they state that during earnings. But you do see it, and it may not have to do with making money from services, but supplying their own chips for example allows them to superfluously color their iMac lineup when they never have before.

 

[sinoka56]

This profit helps Apple’s margins and allows Apple to keep hardware margins lower.

This helps Apple diversify their income sources to increase their value and keep stockholders happy.

 

[ghanwani]

That graph is kind of useless, its excluding total debt. If they have less debt now than before, then the numbers are pretty meaning less.

But they don't. Quite the opposite.
https://www.macrotrends.net/stocks/charts/AAPL/apple/long-term-debt

 

[ghanwani]

Net cash means nothing when their revenue and profit still going up. It's useless without other data.

It means they are spending faster than they are earning. If my earnings go up 20% but spending goes up 30%, where am I headed?

 

[trip1ex]

Net cash means nothing when their revenue and profit still going up. It's useless without other data.

It's not useless. Knowing a company has $63 billion in cash says something. But yeah net cash dropping in and of itself doesn't mean a bad thing at all.

In this case, the reason net cash is dropping is because they've been buying back lots of stock. Their stated goal is to be cash neutral, ie have cash = long term debt.

 

[Glideslope]

The Assimilation Continues. Resistance is Futile.

But what the heck, keep trying. ?

 

[ghanwani]

It's not useless. Knowing a company has $63 billion in cash says something. But yeah net cash dropping in and of itself doesn't mean a bad thing at all.

In this case, the reason net cash is dropping is because they've been buying back lots of stock. Their stated goal is to be cash neutral, ie have cash = long term debt.

Their debt went from $98B in 09/20 to $109B in 09/21. I don't see how that strategy is working.

https://www.apple.com/newsroom/pdfs/FY21_Q4_Consolidated_Financial_Statements.pdf

 

[usagora]

What else does it classify as? It's not a good. It's a service.

Shows how much you know. Check out my AppleCare+ unboxing video on YouTube.

 

[trip1ex]

Their debt went from $98B in 09/20 to $109B in 09/21. I don't see how that strategy is working.

https://www.apple.com/newsroom/pdfs/FY21_Q4_Consolidated_Financial_Statements.pdf

they count long term (marketable) securities as cash. So they actually have $193 billion in cash compared to $109 billion in long term debt.

 

[ericwn]

Shows how much you know. Check out my AppleCare+ unboxing video on YouTube.

Guess the MR article writer is on the same knowledge level.

 

[usagora]

Guess the MR article writer is on the same knowledge level.

You do realize my comment was tongue-in-cheek, right? (because you can't unbox a service ?)

 

[trip1ex]

I give apple too much money now. $30/month for Apple One family. I made the mistake of going to 2 tb for the wife and putting our photos on there and she loves it. She loves seeing a new photo memory every day. So I pay $10/mo for that privilege. lol. And then $15/mo for Apple Music. kids use it. I don't use it much. Wife uses Spotify with ads and won't switch because she has a playlist or two over there.

And now I do Apple One because it's only $5/mo more. $5/mo extra is pretty cheap for all that extra stuff we don't use. lol.

 

[ericwn]

You do realize my comment was tongue-in-cheek, right? (because you can't unbox a service )

Yes I do although you hid it well.