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Just How Much Money Does iPhone X Make Apple? Take a Look

Just How Much Money Does iPhone X Make Apple? Take a Look

By Reuters | Updated: 7 November 2017 10:37 IST

Highlights

TechInsights has torn down the iPhone X, and analysed parts inside
It estimates the iPhone X costs $357.50 to make
Apple, however, retails it at $999

Apple's new flagship iPhone X makes the company more money per phone than its iPhone 8 model, according to an analysis, which found the iPhone X's flashier parts cost Apple 25 percent more than the iPhone 8, but that it retailed 43 percent higher.

The iPhone X smartphone costs $357.50 (roughly Rs. 23,200) to make and sells for $999 (roughly Rs. 64,800), giving it a gross margin of 64 percent, according to TechInsights, a firm that tears down technology devices and analyses the parts inside. The iPhone 8 sells for $699 (roughly Rs. 45,300) and has a gross margin of 59 percent.

The finding is surprising because technology products tend to become more profitable as they age and the parts for them drop in cost.

The iPhone X is a brand new design that went on sale on Friday, to apparently strong demand, while the iPhone 8 is an update on last year's iPhone 7, which itself was similar to the iPhone 6 released in 2014.

Apple declined to comment on TechInsights' analysis.

Apple is unique in the electronics industry for its ability to charge a premium price for its latest devices and for its ability to maintain that price even when selling devices through third parties like telecom carriers, said Al Cowsky, the costing analyst for TechInsights, which planned to post the results to its site late on Monday.

"Apple can be different here because they are the 800 pound gorilla," Cowsky said.

Several of Apple's design choices for the iPhone X pushed up its price. In particular, its 5.8-inch (14.8 cm) edge-to-edge display and associated parts cost $65.50 (roughly Rs. 4,300), compared with $36 (roughly Rs. 2,300) for the iPhone 8's 4.7-inch display, the analysis found.

That is largely because the iPhone 8 uses older LCD technology, while the iPhone X uses what is called "Super AMOLED" technology, which allows for more vivid colours and a thinner overall design.

Another pricey choice was the stainless steel chassis of the iPhone X, which cost $36 (roughly Rs. 2,300) versus $21.50 (roughly Rs. 1,400) for the aluminium housing of the iPhone 8. Cowsky said the steel is less likely than aluminium to bend when flexed, a problem that dogged the iPhone 6 when it came out.

"This is their lesson learned from that," he said.

© Thomson Reuters 2017

Apple iPhone X

REVIEW
KEY SPECS
NEWS
Variants

Design
Display
Software
Performance
Battery Life
Camera
Value for Money

Good
Stunning design and display
Great cameras
Wireless charging
Assured, timely software updates

Bad
Costs a small fortune
First party apps not great in India
Fast charger not bundled

Read detailed Apple iPhone X review

Display 5.80-inch

Processor Apple A11 Bionic

Front Camera 7-megapixel

Rear Camera 12-megapixel + 12-megapixel

RAM 3GB

Storage 64GB

Battery Capacity 2716mAh

OS iOS 11

Resolution 1125x2436 pixels

More Apple mobiles Apple mobiles price in India

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