Despite High Price Tag, Apple Making Slimmer Margin on iPhone X: Report
As we all are well aware, the starting price of the iPhone X comes in at $1319 CAD for the 64GB model, making it the most expensive iPhone sold to date. Apple, however, might not be making as much money per device as one might expect.
According to a report from the Wall Street Journal, Apple is expected to have a smaller profit margin for the iPhone X, despite the high price tag. This is due to the inclusion of certain high-end components including the 5.8-inch bezel-less OLED display and the TrueDepth camera system.
“The starting price of the new flagship iPhone X is about 50% more than the $650 starting price of last year’s iPhone 7 [but] the components cost an estimated $581, up from $248 for components in the iPhone 7, according to Susquehanna International Group,” reads the report. “The gap suggests Apple’s profit margins on the new device are slimmer than on existing lines.”
With that being said, it’s worth noting that the numbers are based on analyst figures rather than anything actually released by Apple. As it has shown time and again, Apple’s great at driving hard bargains — which means that any figures are purely estimates.
Nonetheless, it is difficult to ascertain the fair component cost of the iPhone X before it gets a teardown later this year after its availability. Apart from the component cost, research and development expenses also make up a bulk of the device cost.