The freight train that is the iPhone continues to surge ahead with no signs of slowing down any time soon. But before we look at where iPhone sales might go in the future, let’s quickly recap the tremendous boom in iPhone sales Apple has enjoyed over the past few months.
During the company’s most recent April quarter, Apple sold 61 million iPhones, representing an astounding year-over-year increase of 40%. During the previous quarter — the always lucrative holiday quarter — Apple sold 74.5 million iPhones, representing a year-over-year increase of 46%.
So in just six months time, Apple managed to sell over 135 million iPhones. To put that figure into context, that’s about one iPhone sold for every 2.3 people in the United States.
That being the case, it’s common to hear analysts and tech pundits declare that the iPhone gravy train has peaked and that sales have nowhere to go but down.
While such a sentiment might make sense at first glance, a closer look at the numbers reveals that the upcoming iPhone upgrade cycle — set to be anchored by the iPhone 6s and the 6s Plus — will represent the biggest upgrade cycle Apple has ever seen yet. Suffice it to say, expect Apple to completely shatter all existing iPhone sales records over the next 12 months.
About a week ago, Neil Cybart of Above Avalon did a deep dive into the installed base of active iPhone users and came away with some interesting data. Cybart estimates that there are currently 475 million iPhones being used today. That’s an impressive number, but when Cybart breaks down the iPhone distribution by model type, the figures become all the more intriguing.
As seen above, the iPhone 5s is the most popular in-use iPhone model today with approximately 125 million users. Given that most users upgrade their devices every two years or so, Apple is arguably poised to have upwards 125 million iPhone 5s owners looking to upgrade over the next 12 months. Of course, practically speaking, the actual figure is likely lower once we account for users who recently purchased the 5s at its $99 pricepoint over the last few months.
Nonetheless, the iPhone 5s is just the tip of the iceberg.
Once we add the number of iPhone 5c, iPhone 5, iPhone 4s, and iPhone 4 users into the equation, we see that there are 355 million iPhone users primed to upgrade to a new model once the iPhone 6s and 6s Plus hit store shelves.
While impressive iPhone launches are nothing new, the existing iPhone userbase has never been so crowded, thus paving the way for iPhone sales to soon reach unprecedented heights.
There is a lot that can reached by using that data, but I struggle seeing how someone can look at that breakout and not think similarly to Tim Cook when he says there is still a significant number of iPhone users in the market for an iPhone upgrade. Then take into account Apple’s growing presence in China, and you can start to see how Apple can realistically sell more than 250 million iPhones in FY2016 (they are on track to sell 230 million in FY2015).
Analysts who cover Apple sometimes tend to overlook the fact that iOS as a platform is “stickier” than Android. Put differently, iPhone owners are more likely to stick with their existing smartphone come upgrade time than their Android counterparts. Consequently, it’s a safe assumption that the vast majority of individuals with iPhone 5s devices and below will be keen on upgrading to the iPhone 6s once they’re eligible for a new contract.
As for what the iPhone 6s is poised to bring to the table feature-wise, here’s what we know so far: The iPhone 6s will likely incorporate the Force Touch feature Apple has already implemented on the Apple Watch and the MacBook. It’s also been rumored that Apple’s next-gen iPhone will feature a 12 megapixel camera, improved build quality and screen durability, 2 GB of RAM, a thinner form factor, a next-gen A9 processor, and improved Touch ID functionality.