Skip to Content
Stock Analyst Update

Apple’s 2022 iPhone Revenue Growth Likely Incremental

We are maintaining our fair value estimate for narrow-moat Apple following its annual product showcase.

Mentioned:

On Sept. 14, Apple (AAPL) held its annual product showcase, where the firm announced the launch of a new iPhone, iPad, and Apple Watch. Similar to last year, Apple launched four new iPhone models: the iPhone 13 ($799), iPhone 13 mini ($699), iPhone 13 Pro ($999), and iPhone 13 Pro Max ($1,099), with pricing consistent with equivalent models from the prior year. Beyond the typical chip, battery, and camera enhancements, we equate many of the updates to those of past iPhone “S” models that were more incremental in nature. While 5G penetration remains in the early innings, we think Apple’s fiscal 2022 iPhone growth is likely to be more muted than the growth implied by the current stock price. We are maintaining our $124 fair value estimate for narrow-moat Apple.

Battery life continued to expand, thanks to the new A15 Bionic chip, which is manufactured on TSMC’s 5-nanometer process technology that leverages EUV lithography. For the A15, Apple claims a greater than 50% performance advantage over any other competing mobile chip, while the iPhone 13 boasts 2.5 hours more battery versus the iPhone 12. The Pro has three cameras (ultra-wide, wide, and telephoto), with base and mini models having a dual-camera setup. The emphasis on camera features is consistent with our expectations, with Apple highlighting the “cinematic mode” with greater depth and focus capabilities. The iPhone 13 will launch into 60 countries/regions with 5G support, while the Pro models’ storage will go up to 1 terabyte for an additional $500 relative to the 128-gigabyte base version.

We expect Apple’s fiscal 2021 iPhone sales to surpass the $190 billion threshold, which would imply about 39% year-over-year growth. Although 5G-related momentum should persist into next year, we’re modeling only 4% iPhone revenue growth for fiscal 2022.

Morningstar Premium Members gain exclusive access to our full analyst reports, including fair value estimates, bull and bear breakdowns, and risk analyses. Not a Premium Member? Get this and other reports immediately when you try Morningstar Premium free for 14 days.

Abhinav Davuluri does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.