Apple iPhone 4S’ Best Feature: Nearly 75 Percent Profit Margin

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iPhone-4-vs-iPhone-4S
The iPhone 4 versus the iPhone 4S

Sure, the new iPhone 4S has a brand-spanking new iOS 5, the endlessly cool Siri voice-recognition and HD-quality digital camera. But perhaps the most exciting feature for Apple is the 71 percent to 73 percent profit margin on each handset sold – and there should be millions, one analyst said.


Thanks to numerous Asian-based suppliers and Apple’s tight control, the iPhone 4S should cost just $170-$220 to make, according to Deutsche Bank analyst Chris Whitmore. Carrier subscribers will pay anywhere from $199 to $849 for the iPhone 4S, depending on its memory configuration.

With Apple making the iPhone 3GS free and cutting the 8GB iPhone 4 to just $99, “there is now an iPhone for every budget,” announced independent financial analyst Horace Dediu of Asymco. The ‘bill of materials’ figure from Whitmore is in line with earlier numbers released by researchers at UBM TechInsights.

UBM pronounced the iPhone 4S an ‘evolutionary design’ that cost $203 to build. Monday, the Cupertino, Calif. company announced there were more than 1 million pre-orders during the first weekend consumers could purchase the iPhone 4S.