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AAPL · Forward model · Wearables, Home and Accessories · Bear case

What has to happen in Wearables, Home and Accessories

Model as of

This page changes Wearables, Home and Accessories inside the complete AAPL model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

AAPL forward model
Horizon
Consolidated fair value $217.85 all other verticals held in this portfolio case
Final-quarter revenue $6.24B 5% of company revenue
Explicit segment contribution $49.03B EBITDA less segment capex, before corporate items

The June quarter was the peak. Company growth halves from 16.4% to the guided 9-11%, gross margin steps back from 50.06% to 47-48% as the tariff refunds shrink from about two points to about one, supply constraints were guided to increase significantly sequentially across iPhone, Mac and iPad, and memory costs rise again. Services, the margin engine, already decelerated from 16.3% to 12.1% in a single quarter. R&D has grown at roughly twice the revenue rate for two consecutive quarters with no disclosed AI revenue, so corporate overhead drifts up rather than staying at 17.4%. What this case does NOT assume is a collapse in the installed base or the loss of the Google licensing payment - it says the fiscal 2026 growth rate was a tariff-and-cycle artefact that does not repeat.

Wearables, Home and Accessories

Basis quarter$7.88B
Final quarter$6.24B
Implied CAGR−5%
Final revenue mix5%

$7,883M in the basis quarter, up 6.5% year over year, and the product line with the cleanest calendar in the whole company because the Apple Watch and AirPods refresh lands in September and the holiday quarter does the rest. Apple reports Watch, AirPods, Home accessories and Vision Pro as one line with no sub-split and no units, so line-level growth is the only evidenced driver and the sub-businesses must not be separated.

Last four quarters
2025 Q3 $9.01B Reported
2025 Q4 $11.49B Reported
2026 Q1 $7.90B Reported
2026 Q2 $7.88B Reported
Apple WatchAirPodsHome and accessoriesApple Vision Pro
Sequential growth −2.5%/qtr decaying toward +0.5% Deseasonalised trend: our share of the guided non-iPhone, non-Services remainder under supply constraints.
Wearables, Home and Accessories

Latest: $6.24B (2031Q2E)

Period Value
2025Q1 $7.52B
2025Q2 $7.40B
2025Q3 $9.01B
2025Q4 $11.49B
2026Q1 $7.90B
2026Q2 $7.88B
2026Q3E $9.02B
2026Q4E $11.21B
2027Q1E $7.35B
2027Q2E $7.14B
2027Q3E $8.28B
2027Q4E $10.40B
2028Q1E $6.88B
2028Q2E $6.74B
2028Q3E $7.87B
2028Q4E $9.95B
2029Q1E $6.62B
2029Q2E $6.51B
2029Q3E $7.63B
2029Q4E $9.66B
2030Q1E $6.44B
2030Q2E $6.35B
2030Q3E $7.46B
2030Q4E $9.46B
2031Q1E $6.32B
2031Q2E $6.24B

Assumptions & reasoning

  • Apple bundles Apple Watch, AirPods, Home and Apple Vision Pro into a single reported line and publishes no split of it in any filing. Vision Pro is inside this vertical, not a separate one, and no share of the line is attributed to it here.
  • Seasonality [Q1 0.860, Q2 0.852, Q3 1.006, Q4 1.282] is derived from this line's own printed history. Derived, not assumed: each of the two full four-quarter windows in the printed history (2025 Q1-2025 Q4 and 2025 Q3-2026 Q2) gives a factor of value over window mean, the two are averaged per calendar quarter and normalised to average 1.0. A shape is only asserted where the amplitude clears the disagreement between the two windows by at least 2x. Wearables is the cleanest line on the page: amplitude 0.430 against a maximum between-window disagreement of 0.033, a ratio of 13.
  • The September launch step now lives in the seasonal index rather than in the growth rate, so the -2.5% deseasonalised trend is our share of the guidance-implied remainder: September prints $9,066M, +0.6% year over year against $9,013M.
  • The index assumes the usual September Watch and AirPods launch. A delayed launch moves revenue into the December quarter without changing the annual total, which no quarterly index can represent.
  • Margin and capex intensity are the uniform Products-level assumptions applied to every hardware vertical.
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