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iPhone XS Max Component Costs Estimated at $453 [Updated]
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at $80 for the screen, no one should worry about replacing their screens but I believe it costs a lot more in reality to fix it. Maybe closer to $150-200.
If it costs $443 they can charge +$200= $643... they sell 10M of them that is $2B in profit. Don't tell me its not enough to cover logistics and wages. heck add another $100 to make it $743 just for the fun of it... but at $1100... I dunno seems greedy.
Lets not forget, iphone buyers bring in extra revenue for Apple via buying accessories like cases, wires, airpods, and using services like iCloud, iTunes, and App Store.
If it costs $443 they can charge +$200= $643... they sell 10M of them that is $2B in profit. Don't tell me its not enough to cover logistics and wages. heck add another $100 to make it $743 just for the fun of it... but at $1100... I dunno seems greedy.
Lets not forget, iphone buyers bring in extra revenue for Apple via buying accessories like cases, wires, airpods, and using services like iCloud, iTunes, and App Store.
You will keep it until they stop supporting it and you have to upgrade the the iPhone 11
You underestimate how much of the software and hardware is reused. It's not like everything is developed from scratch for each generation. Most of the software for example is built incrementally on a foundation dating back to the NextStep years. It's the same for hardware. The first iPhone required a huge R&D cost up front (reportedly $150 million) but from then on it's just mostly incremental steps.
Sometimes, it’s the small, incremental improvements that end up costing the most.
I do have a question for everyone who believes this number: How does Applw have an above 150% margin on iPhones but only a 38% overall margin? Which of their things has a single digit margin?
Does Apple have to publish their profit margin to its shareholders. Not sure if that is a mandate. Someone had mentioned that their margin is around 35%.
I have similar observation couple of days back on the cost of mobile justified by TC.
There is nothing big that substantiates significant increase in similar products but Apple cannot be questioned though whether it is right or wrong is their prerogative.
Actually components costs will be optimised with manufacturing efficiency and also R&D is not going to start innovation every iteration.
Even on the services and support there is separate Apple care, parts replacement service charges etc..
Only area they may need to invest high will be their QC which requires thorough testing. Rest of them more iterative as you have correctil pointed out.
Even OLED wireless charging have been adopted long back at higher resolutions and industry has been successfully utilising all major components already to mitigate enormous upfront R&D cost.
Apple typically adopts such technologies only after others implement it successfully for years, huge cost savings in R&D and testing IMO.
Great strategy though!
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No, I'm not very smart at all. I have a very low IQ. Have you ever heard of a general statement I wonder?
Mostly because of Project Titan but who knows what else they are experimenting with. In any case, I'm not willing to fund the development of watches and cars with my iPhone's markup. That's what investors are for.
Sorry they say that from the very start
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That particular markup is disgusting and what puts me off Apple the most. Completely predatory and nothing to do with Apple's own design/innovation/software.
Why don’t you share some of your self proclaimed wisdom with us genius and lets see how close you get. This should be interesting. Please - enlighten us all!
Btw...I see that you “cherry picked” the portion of my quote you used and left out a key part. Way to go genius!
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Yeah, ten years in aerospace R&D. There’s probably some old post by me talking a bit about it.
Now I do something almost completely different.
We know what Apple's profit is. Maybe not on iPhones by themselves but Apple's net profit margins are about 22%. That is Apple markup after all other costs are taken into account. So an $1100 iPhone costs Apple about $860 to design, make, support, etc.
"Their margin" is complete nonsense. There is no such thing as "their margin". There is "gross margin" (revenue minus cost of sales", "net margin" (revenue minus cost of running the business) and "net margin after taxes" (net margin minus taxes paid on that margin). If you hear "margin is around 35%", you should immediately ask "which margin".
And Apple publishes their gross margin every time they announce their earnings, which is once a quarter.
You posted BOM, calculated the difference between sales price and BOM, and claimed that was the gross margin. It doesn't take wisdom to know that's nonsense. Gross margin = sales price minus total cost of sale. Not sales price minus Bill Of Materials.
[QUOTE="That particular markup is disgusting and what puts me off Apple the most. Completely predatory and nothing to do with Apple's own design/innovation/software.[/QUOTE]
Totally agree with this sentiment. Overall, the margins on the device are relatively in line with industry standard - the memory markup, however, is absolutely predatory.
Totally agree with this sentiment. Overall, the margins on the device are relatively in line with industry standard - the memory markup, however, is absolutely predatory.