Telecommunications Industry News
Apple iPhone Could Enjoy Profit Margins Over 50%7:30 am on January 22, 2007 | Category: Business, Cell Phones, Corporate, Mobile Devices, Multimedia
Apple and Cingular will enjoy a combined profit margin of over 50% on the forthcoming iPhone device, according to estimates by iSuppli, which recently put together a Bill of Materials (BoM) estimate for the device.
â€œiSuppli estimates that the 4-Gigabyte version of the Apple iPhone will carry a $229.85 hardware BoM and manufacturing cost and a $245.83 total expense, yielding a 50.7% margin on each unit sold at the $499 retail price,â€ explained Andrew Rassweiler, a senior analyst with iSuppli.
â€œMeanwhile, the 8-Gigabyte Apple iPhone will sport a $264.85 hardware cost and a $280.83 total expense, amounting to a 53.1% margin at the $599 retail price,â€ Rassweiler said.
This exceeds even the impressive margins associated with Apple’s iPod Nano device, and will allow for significant price reductions in the future, potentially giving the iPhone a competitive advantage against the LG PRADA and other rivals.
“With a 50 percent gross margin, Apple is setting itself up for aggressive price declines going forward,” commented iSuppli’s director and principal analyst, Jagdish Rebello, PhD.
- None Found
No Comments yet »
Leave a comment
Published by TeleClick Enterprises
Edited by Jeremy Maddock