Tuesday, August 17, 2010

Average Revenue per Apple Store Location

I was reading this 2001 article the other day. It predicted that Apple Stores would fail since they would need to bring in $12 million dollars of revenue each just to be able to pay the rent.

Despite the doomsayers, the concept has succeeded. So how much revenue does each Apple Store bring in today?

One Quora question and a friendly pointer later, I was reading this Bloomberg article which estimates Apple's flagship Fifth Avenue store to be grossing $350 million dollars a year. That’s the equivalent of selling one Mercedes-Benz C300 sedan per square foot each year. Impressive.

But the 5th Avenue Apple Store is hardly average. What about the average Apple Store location?

This article on AllThingsD puts Apple's total revenue from Apple Stores at $2.58 billion per quarter. That would mean that all Apple Stores make a total of $10.3 billion per year [1].

Scouring through the location list on Apple's website, I counted 301 Apple Stores worldwide [2]. That would put average revenue at $34 million per store. While that's only one-tenth of their flagship location in Manhattan, this kind of revenue should easily cover the rent.

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Notes:

[1] While Q2 is traditionally a weak quarter compared to Q4, Apple released both the iPad and iPhone 4 in Q2 of 2010. That's why I'm relying on Q2 as the indicator for the average across the rest of the year.

[2] Not that Apple boasts with "200 stores worldwide" on that page, but at a closer look has already surpassed the 300 store mark.

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