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Good day subscribers thank you so much for joining me today i am jeremy this is a financial education channel and today we’re talking about why apple revenues are set to explode in 2018 we’re talking over 11 figures for those of you guys at home who do not do math that fast that’s over 10 billion dollars so apple is set to have revenue absolutely explode in 2018
And we’re gonna kind of look at the reasons why and so when you’re thinking about apple as far as the revenues going up a lot or down a lot you need to have two things in mind one is iphone the business is driven by iphone and the second is services which has really become the second biggest revenue and profit category for apple and is a huge growth engine so you
Need a thing about iphone and you need to think about services so we’re gonna kind of pay attention to these two it today and you’ll kind of see why apple is in a really good position over the next year guys so let’s look at this so first off what i want to look at is in the last four quarters how many iphones has apple sold in the last four quarters so apple has
Sold 215 million iphones in the past four quarters so the past year they’ve done 215 million iphones so what i kind of want to think about here is when we run some of these numbers on iphone we’re just gonna assume that their iphone units stay the same which i think is is really super bearish i mean if they only sell 215 again this year i think that’s almost a
Bearish stance rather than a bullish stance that means they didn’t have any increase in that amount of iphones but for the numbers sake we’re just gonna run it as far as that just to be safe and you guys will still see these how these numbers are gonna be insane so first thing i want to look at here is last year you know asp so the average selling price per phone
Went up to $695 it was a $4 raise over the quarter that was not even a huge increase in price in the iphone last year okay this year is a total different ballgame right so iphone 7 that started at $649 the iphone 7 plus that started at $769 this year’s iphones the iphone 8 or starting at six hundred ninety nine dollars that’s a $50 increase their $50 increase
Iphone eight plus is starting at $799 which would be about a $30 increase so the asp no matter what on iphone eights are gonna be much higher than iphone 7 regardless and you regardless guys and then we got iphone x which is coming in november the the newest or excuse me i don’t know why keep calling it iphone x’s iphone 10 this is coming in november guys this
Phone starts at a thousand bucks it starts at a thousand dollars so you can imagine some of the configurations on that are going to be eleven twelve hundred plus dollars guys so let’s run some numbers here i think it’s safe to assume the worst possible case scenario worst possible case scenario is that they would sell the same amount of iphones this year and they
Would only have a sps go up ten dollars okay so we do two hundred and fifteen million iphones times ten dollars and you get two point 1 billion dollars that is the worst worst worst worst worst possible case scenario right there is about a 2.1 billion dollar revenue rise in iphone that’s still insane but that’s that’s kind of like worst case scenario kind of the
Middle ground i would say would be the they sell of same amount i phone so you know 215 million in a espys go up about 25 dollars i think that’s probably the the realistic amount there that’s about a 5.3 almost 5.4 billion dollar raise in revenues and iphone revenues right there a bullish one would be that iphone stay the same and once again these are all as far
As the amount of iphones that’s all bearish i mean if they just sold 215 million again that’s a bear stance on apple but we’re just assuming that okay so 215 million times $40 asp rise maybe eight point six two billion dollars okay so you can see these numbers are insane so the next i want to look at services services they’re doing over seven billion dollars a
Quarter now in revenue on services so you times out seven billion dollars times four quarters in a year that’s twenty eight billion dollars in services revenue now that’s been grown over 20 percent i think that’s going to continue on this year i do not see that slowing down maybe it slows down to a fifteen percent but i still see us keeping around 20 percent that
Would mean though the revenue in services will rise about five point six billion dollars this year guys about five point six billion dollars so if you add in the the median estimate there are about twenty five dollar raise in a espys for the iphone which was over five billion dollars in capital extra revenue coming in there and you add that with what they’re gonna
Probably have in services going up that’s around eleven billion dollars in itself so in remind you i think those are pretty conservative estimates so revenue it should rise just between iphone and services around eleven billion dollars and i think that’s a little conservative guys so you can see that in itself that in itself those two things by itself or you know
Nine or excuse me eleven figure type things guys that’s huge then on top of that you add in the apple watch which you know series three i think this woman will probably definitely outsell the previous models this one should definitely it’s not gonna be a huge revenue rise maybe that brings in an extra billion dollars or so which is an insane amount but for apple
It’s just pennies right apple the the 4k hdr tvs coming out so that should rise to revenue so they got a lot of things going on and but the main thing is iphone the a is peas are going up there’s no doubt about them average selling prices of these phones are gonna go up dramatically just because they’re much more expensive now and then on top of that services is
Just gonna continue to rise i don’t see that slowing down anytime soon so a you know huge things there and then when you’ve got to think about apple and that’s great on the revenue side but on the on the profit side it’s even better right because we know apples just becoming more and more profitable and then on top of that they’re buying back shares in bulk right
Now so you’re gonna have a situation where net income should go up several billion dollars next year right and then there’s gonna be less shares to be counted against so which would raise eps up even at a faster rate which wouldn’t be great so they can raise dividends even more and do some more share buybacks and all that good stuff guys so when i look at apple
There’s no doubt i see revenues exploding over this next year eleven figures plus guys and profits should rise several billion dollars in 2018 now why am i not buying apple stock why am i not well first off you know the future’s long who knows maybe i could buy apple stock at some point i haven’t yet just because i when i buy stock right when i’m buying a stock
I want to buy stocks that i could see realistically doubling within the next few years you know they got such positive cow going that i could see that stock doubling within the next couple of years those are kind of stocks i’m going into right apple i cannot really see this stock necessarily doubling are they gonna have absolutely profits go up revenues go up
Business being even better yes absolutely if i was let’s say twenty years older than i am apple would be probably my biggest investment honestly if i was twenty years older than i am right now and we fast forward this apple would probably be my biggest investment because it still offers some growth in there but it offers also an extreme amount of safety that’s
One of the safer companies i can find as far as the ecosystem as far as you know if somebody buys an iphone they’re probably gonna buy another iphone in another iphone and they get in the ecosystem the apple ecosystem then they start using services and the vigils they’re just you stay in the apple ecosystem at the end the day so it’s one of the safer companies out
There and it’s still a company that definitely offers growth so and it offers dividends so if i was 20 years old we this is absolutely a stock i mean at the end of the day guys but for me in my stages right now i’m trying to find big growth companies that i think are a little undervalued so that’s my that’s my game plan but great company overall in let me know in
That comment section what you guys think if you guys have any guesses on what you think apples revenue would go up next year i would love to hear from you guys in that comment section if you just came across this channel you may want to subscribe we talk personal finance on channel we talk entrepreneurship on the channel and we talk stock market investing more than
Anything thank you for watching guys and have a great day you
Transcribed from video
Apple Revenues Set to Explode in 2018 By Financial Education
