Every year a familiar pattern emerges. Every fall, Apple introduces a brand new iPhone and the critics yawn. “There is nothing to change things,” some exclaim. “The new iPhone is hardly different from the previous year’s model,” some eagerly point out. And in the months that follow, we see a handful of reports alleging that iPhone sales are weak, that production is being reduced, or that Apple has generally lost its ability to innovate in the smartphone space.

The commonality here is that pundits and analysts continue to underestimate the freight train that is the iPhone. Of course, not all new models are packed with bells and whistles. And of course, some models sell less than others. But if you zoom out and take a bird’s eye view of Apple’s iconic smartphone, the iPhone remains an unrivaled success.

iPhone revenue set new record for fourth quarter

This scenario happened recently when Apple released its income report for the September quarter. Despite fears of falling iPhone sales, Apple’s earnings report revealed that iPhone sales remained incredibly strong.

Ultimately, iPhone-based revenue for the quarter came in at $46.22 billion. This figure is almost $2.5 billion more than the revenue generated by the iPhone in the same quarter last year.

During Apple’s earnings conference call, Tim Cook noted that the $46.22 billion figure was a record for the September quarter. Take a second and think about this: People say, “The iPhone has peaked!” » for years. And in 2024, 17 years after the launch of the original iPhone, and facing immense competition from Android, Apple has just set an iPhone revenue record for the September quarter. It’s astonishing.

Apple no longer releases quarterly sales figures, so we have to rely on overall revenue to gauge the strength of iPhone sales. That said, one of two things is happening: 1) iPhone sales are up, or 2) iPhone sales are somewhat stable, but more users are opting for the Pro models more expensive. Either way, the answer doesn’t matter because the bottom line is the same: the iPhone remains a revenue driver for Apple.

Consider this: iPhone revenue in the September 2020 quarter was $26.4 billion. In four years, iPhone revenues have increased by more than 50%.

The iPhone could have better days ahead of it

Looking ahead, it remains to be seen whether Apple Intelligence will lead to a wave of iPhone upgrades. But it’s often forgotten that most users don’t upgrade to new iPhone models every year, as we’ve seen in the past. Instead, iPhone users are holding on to their devices longer than ever.

Therefore, it stands to reason that many people buying new iPhones are coming from devices that are 3-6 years old. In other words, the subtle, incremental improvements to the iPhone don’t deter existing users from upgrading. Rather, most are upgrading older models. For these users, a new iPhone represents a major leap forward in performance and features.