Those $40 magnetic smart covers bought to protect the iPad 2 are worth a collective $300 million for Apple in just the latest three-month period, a Wall Street analyst announced Monday. Half of that is pure profit for the tech giant.
“If we assume that 90 percent of iPad sales in the June quarter include Apple’s covers, then this would add up to $300 million in revenue and $150 million in gross profit,” BMO Capital’s Keith Bachman told investors.
This isn’t the first time the Cupertino, Calif company has cashed-in on segments of the Apple economy. A recent report pointed to Apple’s decision to switch from hard drive-based Macs to flash memory. Although the company charges $100 more to buy a 32GB iPhone or iPad versus the 16GB equivalent, the tech giant pays just $15 more — an 85 percent gross margin, the Wall Street Journal reported.
Perhaps because of the Smart Cover markup, Bachman also raised his estimates for iPhone and iPad sales. He now estimates 16.7 million iPhone sales for the June quarter, up from a previous 16.1 million units. The analyst also projected 8.5 million iPad sales for that three-month period. Apple should sell 9.5 million tablets during the September quarter, higher than Bachman’s previous judgement of 9 million units.
Looking at 2012, Bachman believes Apple will sell 46.4 million iPads, up from his previous full-year projection of 45.8 million units. All of which likely means more smart covers and more cash for Apple’s bulging coffers.