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Report: ‘Apple iPhone to Generate Nearly 50 Percent Margin’

According to a preliminary functional Bill of Materials (BoM) estimate created by iSuppli Corp., each Apple iPhone sold will generate nearly a 50 percent gross margin for Apple Inc. and partner Cingular Wireless, giving the companies a hefty profit, as well as plenty of room for future price cuts. “iSuppli estimates the 4Gbyte version of the Apple iPhone will carry a US$229.85 hardware BoM and manufacturing cost and a $245.83 total expense, yielding a 49.3 percent margin on each unit sold at the $499 retail price,” said Andrew Rassweiler, teardown services manager and senior analyst for iSuppli. “Meanwhile, the 8GByte Apple iPhone will sport a $264.85 hardware cost and a $280.83 total expense, amounting to a 46.9 percent margin at the $599 retail price.”

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