Apple Announces Record Breaking Q4 2021 Financial Results
Apple announced its Q4 2021 financial results. According to Apple, this quarter marked a Q4 revenue record of $83.4 billion, up 29% compared to the same period 12 months ago.
It is indeed quite interesting to examine closer the sales mix of fiscal year 2021. More specifically, the sales of Apple’s 2021 Fiscal Year (12 month period) came from:
iPhone: 52%
Services: 19%
Wearables, Home & Accessories: 10%
Mac: 10%
iPad: 9%
The overall gross margin was 42% up from 38% a year ago.
Services
Interestingly enough, the revenue coming from Services has significantly grown by 27% over the last 12 months as new revenue records have been set for its cloud services, financial services, Apple Music, Apple TV, Apple Arcade and any other service category.
The gross margin [(sales - cost of sales)/sales] on services is significantly higher compared to product sales (70,5% vs 34,3% on the last quarter). Simply put, Apple makes almost double the profit for each dollar spent on services compared to products which helps boosting its profitability
The above proves that Apple’s focus on services during the last few years is paying off as it remains a solid revenue and profit pillar for the US tech giant.
Products
The FY 2021 iPhone revenue was up by 39% compared to FY 2020 proving the massive success of the iPhone 12 series. During the earnings call, it was made clear that the iPhone 13 series inventory is lower than forecasted due to supply constraints which prevent Apple from meeting the strong iPhone 13 demand.
iPad sales have also been strong with a 34% increase over the last 12 months. Wearables, home and accessories sales were also boosted by 25%.
Mac sales were increased by 23% as the performance of the M1 Macs have made them significantly popular both for retail and corporate clients. The entry level M1 Macbook Air has been a great value for money as it combines unparalleled performance for its price. Apple’s chip technology isn’t the same as the most popular Intel and AMD chips, which means that Apple is sourcing different components and is not affected by the same production problems. However, the increased demand is still not able to be met. Apple estimates that supply chain constraints affect its revenue by 6 Billion USD.
Next Quarter Predictions
Apple is expected new sales records for all of its product lines and services apart from the iPad business due to the chip shortages. It’s been clear, although not stated, that Apple selects to favor other business lines instead of the iPad with the iPhone having the edge of course.
