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  • December 2016 (Revised January 2017)
  • Supplement
  • HBS Case Collection

Accounting for the iPhone Upgrade Program (B)

By: Jonas Heese, Krishna G. Palepu, H. David Sherman and Monica Baraldi
  • Format:Print
  • | Language:English
  • | Pages:4
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Abstract

In October 2016, Apple Inc. announced the financial results for its fiscal year 2016. CEO Tim Cook commented on a very successful fiscal year 2016 and focused on all the positive financial results. However, Apple’s 2016 annual report was also telling another story. Apple’s total revenue had decreased 9%, and iPhone revenue decreased 13% compared to the fourth quarter of fiscal year 2015. Apple also faced some criticism from consumers regarding the iPhone 6 and iPhone 6 Plus Upgrade Program. A September 2016 survey reported that an increasing number of customers decided to subscribe to the iPhone Upgrade Program. In spite of this, the company was very supply constrained on the iPhone 7 and 7 Plus, and financial analysts were still eager to receive more information on the impact of the iPhone Upgrade Program on Apple’s financials. This case serves as a complement to the case "Accounting for the iPhone Upgrade Program (A)".

Keywords

Apple Inc.; iPhone 6s; Accounting; Revenue Recognition; California; United States

Citation

Heese, Jonas, Krishna G. Palepu, H. David Sherman, and Monica Baraldi. "Accounting for the iPhone Upgrade Program (B)." Harvard Business School Supplement 117-039, December 2016. (Revised January 2017.)
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About The Authors

Jonas Heese

Accounting and Management
→More Publications

Krishna G. Palepu

Accounting and Management
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Related Work

    • December 2016
    • Faculty Research

    Accounting for the iPhone Upgrade Program (A) and (B)

    By: Jonas Heese, Krishna G. Palepu and H. David Sherman
    • December 2016 (Revised January 2017)
    • Faculty Research

    Accounting for the iPhone Upgrade Program (B)

    By: Jonas Heese, Krishna G. Palepu, H. David Sherman and Monica Baraldi
Related Work
  • Accounting for the iPhone Upgrade Program (A) and (B) By: Jonas Heese, Krishna G. Palepu and H. David Sherman
  • Accounting for the iPhone Upgrade Program (B) By: Jonas Heese, Krishna G. Palepu, H. David Sherman and Monica Baraldi
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