According to market analyst iSuppli, each iPhone sold by Apple and Cingular will generate around 50% of gross margin for them. Fifty percent is too much and can easily compensate for the future price cuts. iSuppli prepared a tabulated preliminary functional Bill of Materials (BoM) which shows that a 4GB model which will retail at $499 costs $245.83 and 8GB model priced at $599 costs $280.83. Lets do some math now considering the iSuppli’s figures. Apple forecasts to sell 10 million units of iPhone by 2008. Let’s assume they manage to achieve their target, 5 million each for both the variants.
$1265850000 (4GB Gross Profit)
$1590850000 (8GB Gross Profit)
$2856700000 (Total)
The above figure is really huge but there’s one deterrent to this. There is no inclusion of the R&D expense which could bring these margins more lower. Check out the detailed report here.
[Via Digg]
Researches and brains cost much bigger than builded product.