In 2013, Apple booked $21.5 billion in Mac revenue and operating income of $5.9 billion; this year's sales estimates would generate between $23.2 billion and $24.7 billion, with operating income between $6.4 billion and $6.8 billion.
Most experts have attributed the first-half-2014 Mac sales bump to lower prices, particularly the 7%-10% cuts of April to the popular MacBook Air, the third reduction in 26 months.
"A hundred dollars here and there, sooner or later you're talking about real money," said Ezra Gottheil of Technology Business Research about the typical Apple price cuts.
Since Apple began cutting prices of the MacBook Air in June 2012, it's reduced prices between 8% and 25%, depending on the model. The more-popular 13-in. notebook has seen the biggest cuts, between 23% and 25%, while the lower-priced 11-in. has been discounted by no more than 10%.
Bajarin attributed some of the Mac's stronger sales to the lower prices, calling them "helpful." But he also argued, as he has before, that there are other factors in play.
As consumers -- the Mac's true audience -- consider upgrading some but not all of their older machines, the higher-priced Mac starts to look more attractive and even more economical. (Not every family member needs his or her own computer because each is already armed with a smartphone or tablet, or both.)
"They're willing to make an investment in a computer that will last a long time," Bajarin said, referring to the Mac.
"I remain convinced that, particularly with the changes in the landscape, the muted and confused response to Windows 8, that consumers are really looking at everything," said Bajarin. "There are a couple hundred million PCs that are four, five years old, and those owners are going to look around as they consider replacing them."
The increased sales of Macs in the first half of 2014 -- 8.55 million or 6% more than the previous Q1-Q2 record -- hints that Bajarin's thesis is already playing out, and perhaps getting a jump on Windows PCs. Many experts expect the rebound to continue as consumers reenter the market in the second half of the year.
Personal computer shipments, according to research firms IDC and Gartner, have stabilized or slowed their free-fall in 2014's first half, in part because companies are continuing to replace ancient Windows XP systems after that OS reached retirement in April. Those replacements will probably end this year, however; IDC and Gartner have predicted that consumers will then take up the slack.
Both Bajarin and Gottheil were bullish on the Mac for the remainder of the year. "I think that edging prices lower will continue to happen," said Gottheil of Apple's strategy. But that's happening across the industry. "In the Windows PC world, there's a lot of moves toward lower prices," he added. "The ASP [average selling price] curve is lowering at both the high and the low ends."
Neither analyst expects Apple to suddenly abandon its practice of playing in the premium-priced segment in an effort to grab market share. But each saw not only evidence of impending moves to juice sales, but ways Apple could, perhaps, reach Bajarin's seemingly-fantastic goal of a 20% share.
"I can see Tim Cook, who is a somewhat more flexible manager [than former-CEO Steve Jobs] saying, 'Build me a MacBook Air using something other than an Intel Core processor, let's see how it works,'" said Gottheil. "If it can provide the full Apple experience, why not sell it?"
Apple would have a chance to lower prices in its more traditional fashion -- and thus increase its share -- said Bajarin, if, when it eventually releases a Retina-quality-display-equipped MacBook Air, it retains the current models at lower prices.
"Apple's not going to ever be a low-cost leader, but the Mac could bleed into the $799 range -- with the 13-in. MacBook Air, not the just the 11-in.," said Bajarin. "At that price, it could really start to squeeze the traditional sweet spot of Windows notebooks, which is in the $550 to $599 range."
That move would be reminiscent of what Apple has done in the iPad line, where when it launches new models, it keeps selling an older model after cutting the price $100. When Apple debuted the iPad Mini with Retina last year, for instance, it lowered the price of the original non-Retina Mini by $100 to $299.
But holding the price line of a Retina MacBook Air -- and thus creating an umbrella under which the non-Retina Air could be placed -- would be contrary to how Apple handled the MacBook Pro's transition to a higher-resolution display. In 2012, when it launched the first Retina MacBook Pro, Apple simply inserted a new model -- a 15-in. MacBook Pro with Retina -- into the line at a price $400 higher than the lowest-priced 15-in. stock model. The existing laptops' prices did not change.
"I see Apple as sitting on the cusp [of that decision], with some types of products that do start to tip into the lower price range," said Bajarin. "I think they'll continue to be aggressive, and continue to make the Mac's case. But the thing to understand is that Apple is in control of [its] own destiny."
