Apple Retail Stores Rack Up Record Revenue Per Customer

“I give them two years before they’re turning out the lights on a very painful and expensive mistake.”

That’s what David Goldstein, president of research outfit Channel Marketing, said of Apple after the grand opening of the company’s first retail stores in 2001. Yet 12 years later, the lights in Apple’s stores remain lit, there are 406 of them spread across 14 countries, and they boast hands-down some of the most valuable retail space in the world.

In the first quarter, Apple’s average revenue per store topped out at about $13 million, reaching its highest level ever for a non-holiday quarter, according to Asymco analyst Horace Dediu. And the company collected a record $57.60 in revenue per visitor, with about $12 of that being profit.

Impressive numbers for Apple, which continues to outperform all other retailers on a per-square-foot basis in the U.S., by a very wide margin. Apple Stores earn twice as much per square foot as Tiffany & Co., the second-most-lucrative U.S. retailer, and three times as much as Lululemon Athletica, the third-most-lucrative.

And the company’s average revenue per visitor will only improve as it expands internationally, particularly in big untapped markets like China. Apple essentially doubled down on its retail presence in greater China over the past year, raising the number of stores to 11 from six. And according to CEO Tim Cook, that’s just the beginning.

“This isn’t nearly what we need, and it’s not the final by any means,” Cook said earlier this year. “We’re not even close to that. But I feel that we’re making great progress, and I am very happy with how things are going.”

And whatever the China market may lack in individual wealth, it makes up for in volume.

“This is one of the great paradoxes in Apple retail: The more Apple expands internationally, the higher their average retail revenue becomes, despite them opening stores in emerging markets such as China,” said Carl Howe, VP for research and data sciences at Yankee Group. “As a proof point, the New York flagship 5th Avenue Apple store used to be one of the highest grossing stores in the entire Apple chain, pulling in somewhere around $350 million in revenue in 2010. Today — based on anecdotal evidence, but I believe this to be true — nearly every Apple store in China sells as much or more than the 5th Avenue store. China may have a lower percentage of wealthy people than the U.S., but they have more absolute numbers of them.

“What I think this all says is that Apple has itself as a global aspirational brand, and that people will go to amazing economic lengths to own Apple products,” Howe said. “So long as Apple maintains that premium brand and value, the only limits to its retail growth is how many stores it can build.”