During Apple’s Q2 2017 Earnings Report, Apple CEO Tim Cook noted that demand for the newest MacBook Pro remains strong and that Mac revenue grew by 14 precent year-over-year. On the surface, this seems like something to crow about, but it may be simply all that glitters.
In Q2 of 2016, Apple sold 4.034 million Macs which generated $5.107 billion in revenue. In Q2 of 2017, Apple sold 4.199 million Macs, and that generated $5.844 billion in revenue. So unit sales were up 4 percent year-over-year, but revenue was up by 14 percent. This has to be due to the fact that, as Tim Cook said in the earnings report, demand for the newest MacBook Pro remains strong. And that’s one of the more expensive Macs in the lineup, so increased revenue and Mac ASP is expected.
On the surface, this seems like something to be happy about, and Mr. Cook took the opportunity to express his pleasure.
What these numbers suggest is that while the 2016 MacBook Pro with Touch Bar is popular, its sales are masking an overall decline in the sales of other Macs. That’s not surprising. The Mac mini was last updated in October, 2014. The MacBook Air was last updated in March, 2015. The iMac was last updated in October, 2015. And the last MacBook was last updated in April of 2016.
While Apple is enjoying the benefits of the MacBook Pro sales, that enthusiasm can’t last forever. The question is, can Apple update its other Macs in a timely fashion so that as the demand for the latest MacBook Pro fades, other Macs can take up the slack?
All we know is that we can expect new iMacs in the fall and nothing else. If demand for the MBP endures, Apple can skate for one more quarter or two. However, if that MBP, announced in October of 2016 with a Skylake CPU looks to be increasingly aged compared to modern offerings from HP and Microsoft, it could be a difficult Q3 and Q4 for Macs.
I think it’s great that Apple has arranged things so that Mac revenue is up by 14 percent year-over-year. I just don’t think, given its current and planned Mac portfolio, Apple can keep up this kind of transfer of focus. Emphasizing a growing Mac revenue without corresponding, exciting new products phased in is a short-term, Band-Aid strategy. In my opinion, Apple’s enthusiasm for this as an enduring strategy is unjustified.