No comparing Apples with Apples

Apple’s peevish decision to stop reporting the number of smartphones, tablets and laptops it sells makes little sense. There is no secret to the company’s recent success. Powerful revenue growth has come from charging customers more for fancier versions of existing products. Obscuring unit figures will simply fuel suspicion that sales are falling.

Even if sales figures do dip, the company could still tot up another record year in 2019 through upgrades of iPads and MacBooks. Those who do more with their iPad than prop it up in bed to watch films will probably accept paying $2,000 for a new iPad Pro. Apple customers have proved themselves a devoted group.

The strategy has already worked with the company’s most popular product. The average iPhone sales price is now $793 from $618 in 2017. Users unable to put down their phones will not find it too hard to justify spending more. Fashion folk like to talk about the cost per wear of an expensive item. The average American checks their phone 80 times a day. In a two-year lifecycle the iPhone’s average cost per check is therefore just 0.1c.

The 7% fall in Apple stock in after-hours trading on Thursday was overwrought, even if trade tension next quarter breaks its run of double-digit revenue growth. The world’s most valuable listed company remains a profits machine. It did not matter that China accounted for 18% of total revenue, from almost 20%. Or that sales of iPhones were flat on the year. The company’s plan to make customers pay more is working.

Profits are up almost a third on the same period last year. Until now, however, Apple has largely missed out on the stock market slump that has affected the rest of the tech sector. Overreaction to a slightly cautious forecast for holiday sales is the company’s comeuppance. /London, November 2