For numerous years, the iPhone has played a pivotal role in bolstering Apple's earnings. Sales of the iPhone have consistently accounted for a substantial share of Apple's overall revenue.
Apple differentiates its products by pricing them higher than its competitors, implying that the products are of better quality and incorporate the latest technology. This targets the minds of any normal human and makes its products come off as superior. This is called a product differentiation marketing strategy, and it seems to be working well, as Apple is bumping up its pricing with every new iPhone launch.
According to Apple’s Q4 reports for 2021, the company posted a September quarter revenue record of $83.4 billion, up 29 percent year over year, and quarterly earnings per diluted share of $1.24. This was the year when the iPhone 13 range was launched. This was the most loved rage among the customers. Everyone had something in store for them in terms of variety as well as pricing. And the most sold model was the iPhone 13, indicating consumers were still buying flagship devices, but at the entry level rather than the top end.
In 2022, Apple launched the iPhone 14 range with a 6.7-inch model called the iPhone 14 Plus that replaces the iPhone 13 mini. A cheaper model was replaced by a costlier one, which reflected a shift in consumer buying habits toward the most high-end models. Customers opted for flagship models like the iPhone 14 Pro and Pro Max. Voila! Revenue increased. Apple announced financial results for its quarter-four report of 2022: a record revenue of $90.1 billion, up 8 percent year over year, and quarterly earnings per diluted share of $1.29, up 4 percent year over year.
The recent launch of the iPhone 15 series saw the Pro model starting at $999 and the Pro Max starting at $1199, which is $100 more than last year. In addition to the Pro models, Apple also offers two cheaper options, the iPhone 15 and iPhone 15 Plus, which cost $799 and $899 and up. They are not as cheap!
Apple's strategy of offering premium products at higher price points has been successful in maintaining strong profit margins. The company has historically priced its flagship iPhones at a premium compared to many competitors. This approach has allowed Apple to weather market fluctuations and maintain steady revenue growth over the years.