Apple Inc (NASDAQ:AAPL, ETR:APC) has showcased remarkable resilience in its iPhone market share and revenue, defying the overall sluggishness in the smartphone market, according to the Bank of America.
Despite a decline in iPhone units shipped over the past three years, analysts at BofA noted that Apple has managed to consistently increase its market share in terms of revenue.
In a recent note, analysts pointed to Apple's strategic pricing approach as a key factor in its success.
Over the years, Apple has expanded its iPhone lineup, offering a wide range of models with prices spanning from $429 to $1,599.
“In our opinion, this pricing strategy, along with installment plans introduced by Apple and carriers, has led to the iPhone installed base reaching a record level of 1.2 billion in 2023,” analysts wrote.
Despite the decline in unit sales, analysts noted that Apple has maintained a dominant position in the premium smartphone market, particularly in the $1,000 and above price band, where it commands over 90% market share. This steady increase in market share has been accompanied by a meaningful rise in services revenue per installed base device, climbing from $50.59 in 2019 to $73.01 in 2023.
Moreover, analysts highlighted a trend wherein used iPhones constitute a growing percentage of the installed base, reaching 34% in 2023. This suggests a potential migration of users from used to new iPhones over time, further bolstering Apple's market presence.
Bank of America has a Buy rating and US$225 price target on Apple stock.