Apple customers are worth up to $153 per month

“Shares of Apple (AAPL) are up after Goldman Sachs’s Simona Jankowski reiterated a Buy rating on the shares and a $163 price target, and added the stock to the firm’s ‘Conviction Buy List,’ arguing the stock’s going to undergo a shift in how investors view it in 2016, being seen more as a company with recurring revenue streams, less as a hardware vendor,” Tiernan Ray reports for Barron’s.

“Jankowski models each Apple customer producing an ‘average revenue per user,’ or ARPU, a metric often used in subscription businesses such as cable and publishing,” Ray reports. “That metric is initially $42 per user, she estimates, but can rise to $153 per month, assuming an iPhone user buys all other Apple hardware products.”

“Jankowski arrives at the $42 by taking the average installment plan payment per month for various hardware products, including iPhone, for 24-month installment periods,” Ray reports. “At that $153 ARPU, a customer would be spending $32.45 per month on the iPhone, additional amounts on all other hardware items, for a total of $93.43 per month in hardware spend; and an average of $59.99 per month in content and other services and software. On the way to all that, it’s possible to hit a mark of around $82 if Apple customers just had an iPhone, the Apple Music monthly subscription, and perhaps paid $40 per month for what she expects is a forthcoming streaming television service from Apple.”

Read more in the full article here.

MacDailyNews Take: Well, we did let our iTunes Match subscriptions go since we’re Apple Music members anyway, so we “saved” $24.99 per year, at least!