Services Approaching the $20 Billion Mark
The one area in which Apple is showing absolutely no signs of slowing down is in its Services business, which is now dancing on the $20 billion lineup.
What’s even more interesting about this is that Apple introduced only one new service this year: the Apple Music Voice Plan. While only Apple knows for sure how many new subscribers that drew in, it’s hard to believe that was enough to drive nearly $4 billion in additional revenue compared to last year’s holiday quarter.
While Apple’s other categories seem to grow (and sometimes shrink) in waves, its services category has remained on a slow and steady upward trend, nearly doubling from Q1 2019, and consistently growing by around 24 percent over the past two holiday quarters.
It’s also the one category that has been growing steadily, not only year-over-year but from quarter to quarter. Hardware sales ebb and flow, and of course, the holiday quarter always drives far more product sales, resulting in a Q1 surge each year. By their very nature, services simply accumulate subscribers, and as long as more people are joining than leaving, the numbers simply keep going up.
In fact, Apple said that it added a record number of 165 million new subscribers worldwide during the holiday quarter, bringing it to a total of 785 million paying customers.
So, there’s little doubt services revenue is set to break $20 billion very soon, and we wouldn’t be at all surprised to see that happen as soon as the Q2 2022 results come out in April.