With a starting price of $999, the iPhone X may be Apple’s most expensive iPhone yet, but that doesn’t necessarily make it its most profitable.
In fact, according to a new report, Apple could actually make a smaller profit margin on the next-gen flagship phone than on previous handsets, due to the increased cost of components.
Gotta spend money to make money
The Wall Street Journal notes that the components for the new device stand at an estimated $581, significantly more than the $248 for the iPhone 7. The upshot is that, despite ramping up the price for the new iPhone, Apple may actually take home less from each handset sold.
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.
Still, it’s interesting to hear, especially because the iPhone 8 and 8 Plus haven’t necessarily proven to be flying off the shelves at the speed of previous iPhones. Couple lowered interest in the iPhone 8 with shrinking profit margins (possibly) for the iPhone X, weakening demand in China, and possible lower-than-usual yield rates for the flagship device, and it could certainly have an impact on Apple.
Despite this, if the iPhone X can be the kind of hit many expect it to be, Apple’s massive cash pile certainly means that it can afford to take a short term hit if it means long term success.
Which new iPhone, if any, are you planning to buy? Leave your comments below.