In its fiscal third quarter, Apple saw a record number of Android to iPhone switchers (really, they’re upgraders; big upgraders). These high switcher rates are fueling surging growth in the company’s installed base of active devices. On top of that, growing engagement levels in Apple’s installed user base means each Apple product user is becoming even more valuable.
In its fiscal third-quarter earnings call, Apple reported 3% year-over-year growth in iPhone revenue.
Daniel Sparks for The Motley Fool:
If an iPhone buyer is an existing iPhone owner, the company’s installed base of active devices does not increase. But if the buyer comes from a different phone, the company adds another user to monetize across its App Store and other services. An iPhone buyer who is switching from another device, therefore, is arguably much more valuable than a repeat buyer.
Apple’s emphasis on growing its installed base is working across all of Apple’s product categories and geographies, with the company achieving all-time high installed bases across every one of these segments in fiscal Q3. Further, Apple said it saw “increased customer engagement” with its services during the quarter, showing that the value of each user in its installed base continues to increase.
A good example of this is the growth in paid subscriptions — including both third-party and native subscriptions — on its platform. Paid subscriptions across its user base were 860 million by the end of fiscal Q3, up by more than 160 million over the year-ago period. Further, Maestri said its “transacting accounts, paid accounts, and accounts with paid subscriptions all grew double digits year over year.”