Is Apple the tail that wags the U.S. economy?

October 27, 2014, 2:26 PM UTC

Jeff Sommer rattled off some impressive stats in his Sunday New York Times column:

  • Apple is the biggest company, by market capitalization, in the world.
  • Apple accounts for about 3.5% of the weighting of the S.&P. 500
  • Apple accounted for 18% of the entire rise of the S.&P. 500 this year
  • Apple iPhone sales are adding 1/4 to 1/3 of a percentage point to the annualized growth rate of the U.S. GDP, according to Michael Feroli, chief U.S. economist for JPMorgan Chase


Sommer treats Apple as if it were a one-product company, and it’s hard to fault him. After all, the iPhone accounts for more than half of Apple’s revenue and, according to Bernstein’s Toni Sacconaghi, between 60% and 70% of its profits.

Sommer also takes pains to point out that the average selling price of the 39 million iPhones Apple sold last quarter was $603, and that the profit margin on those sales was nearly 50%.

By his accounting, the iPhone — by itself — is the tail that wags the U.S. economy.

For another point of view, consider CNBC’s Phone 6 won’t be a boost to GDP, published three weeks earlier.

Using a stat I’m not familiar with — the Bureau of Economic Activity’s report on telephone and fax equipment consumption — Paul Dales, an economist at Capital Economics, concludes that iPhone 6 sales, strong as they were, won’t have a meaningful impact on the U.S. economy. By his estimate, less than 0.01% of GDP.

Follow Philip Elmer-DeWitt on Twitter at @philiped. Read his Apple (AAPL) coverage at or subscribe via his RSS feed.

Subscribe to Well Adjusted, our newsletter full of simple strategies to work smarter and live better, from the Fortune Well team. Sign up today.