After several launches in the past few months, Apple exits the pandemic and stay-at-home year with arguably one of the most impressive lineups of products and services in recent memory.
I believe that Apple’s offerings portfolio will set the tone for the company’s financial performance in 2021 – from the iPhone 12 fueling the 5G super cycle to the brand new AirPods Max possibly exposing Apple to a whole new market of music lovers.
Let’s look at some of Apple’s products and services launched in 2020 that will likely make a difference for the Cupertino company and its financial results in the new year.
iPhone 12: the super cycle is on
It took longer than originally expected, but Apple finally launched its iPhone 12 in October. The company is now knee-deep in the race for the hearts and minds of 5G users.
I like Apple’s lineup of 5G-capable devices because it ranges widely within the price spectrum. The iPhone 12 Mini can be purchased for as low about $700, allowing more price-sensitive consumers to join the party. At the opposite end, the fully equipped iPhone 12 Pro Max, with 512 Gb of storage, costs about twice as much.
Apple could use a boost to smartphone revenues in 2021. The segment was the only one to see its top line shrink year-over-year in fiscal 2020, in this case by 3%.
Maybe the iPhone 12 will do the trick.
New Mac: from the ground up
To be frank, I did not originally think much of the product refresh, since Macs usually account for less than 10% of total revenues and minimal growth during non-pandemic years. But maybe I should rethink my lack of enthusiasm.
Apple’s laptops and desktops had a strong 2020, due to the stay-at-home dynamics. Revenues increased by 11% – a respectable number, considering how mature this product category has been for a while.
The success of this segment in 2021, off tough comps, will likely depend heavily on the new M1 Macs. It is very probable that Apple will introduce new models with the same architecture, including a refresh of the 16-inch devices.
AirPods Max: untapped revenue opportunity
How much of a different a piece of headphones can make for Apple in 2021? The answer could be “a lot”.
Judging by the success of the AirPods and AirPods Pro in the past couple of years, the AirPods Max could be the next engine of growth within an already promising wearables and home segment.
Despite the rich price tag, at about $550 apiece, the AirPods Max is already backordered in the Apple Store. In the US, all five color versions are currently not expected to ship for another 8 to 10 weeks.
This is a good early sign that demand for the device has been strong out of the gate.
Apple One: next leg up in services
The services segment is a key tenet in virtually any bullish thesis on the stock. The focus on monetizing the user base through service sales remains, and the path forward for the segment continues to look promising.
Apple One could solve a huge problem by increasing demand for the company’s newest and less successful services, including Fitness+, Arcade and News+.
This could be the path to Apple doubling service revenues once again within the next five years or so.
Don’t forget the others
At least two other products deserve an honorable mention. The new iPad Air got quite an appealing facelift in September, while the Apple Watch Series 6 with blood oxygen monitor added health and wellbeing applications to the wearable device.
Who knows, these two devices could also steal the spotlight in 2021 and help Apple produce above-consensus results in the new year.
I have run another poll going on Twitter in which I ask what people think will be Apple’s game-changing product in 2021. Feel free to share your thoughts:
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