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SmArTeStChIlD421 · 06-25-2008, 2:23 PM

Study: Apple Makes $26 Profit on Every iPhone 3G

06.25.08
by Chris Gampat

According to a preliminary analysis by iSuppli Corp., the new Apple iPhone 3G materials and manufacturing cost is $173. The initial retail price of the phone announced by Steve Jobs will be $199. iSuppli has performed a breakdown of the costs using insights from its analysis staff to develop estimates of iPhone content, suppliers, and costs.

"The new iPhone is significantly less expensive to produce than the first-generation product, despite major improvements in the product's functionality and unique usability, due to the addition of 3G communications," said Dr. Jagdish Rebello, director and principal analyst for iSuppli. "The original 8Gbyte iPhone carried a cost of $226 after component price reductions, giving the new product a 23 percent hardware cost reduction due to component price declines."

Tina Teng, wireless communications analyst at iSuppli, added that if the 3G iPhone design is unchanged, the cost should drop down to $126 in 2012.

Study: Apple Makes $26 Profit on Every iPhone 3G - News and Analysis by PC Magazine

spleck · 06-25-2008, 9:30 PM

Other sources have claimed that AT&T is paying $525 for the iPhone, plus $100 commission for phones sold from the Apple Store. The $325 subsidy was "more than 50% higher" than their standard subsidy of $200.

I think whoever titled that article is an numbnut. There's so many more inputs to the equation that saying $26 profit based on material cost and the subsidized sale price is ridiculous.

bobolito · 06-25-2008, 11:51 PM

Quote:

Originally Posted by spleck

Other sources have claimed that AT&T is paying $525 for the iPhone, plus $100 commission for phones sold from the Apple Store. The $325 subsidy was "more than 50% higher" than their standard subsidy of $200.

I think whoever titled that article is an numbnut. There's so many more inputs to the equation that saying $26 profit based on material cost and the subsidized sale price is ridiculous.

Here's what happened: The article was originally posted at Gearlog. Then some "numbnut" at PC Mag who did the copy and paste job actually changed the title of the article and reposted it on PC Mag's website. The original title says: "Apple iPhone 3G: Costs $173 to Make One" which is correct. There are already comments on PC Mag saying the title is incorrect. How shortsighted indeed.

Mobile Mike · 06-26-2008, 5:30 AM

In any case, Apple's riding high making a nice profit nonetheless...

walkguru · 06-26-2008, 10:08 AM

Wirelessly posted (Walkguru's: Opera/9.50 (J2ME/MIDP; Opera Mini/4.1.11328/534; U; en))

thier making more than 26 dollars i think.

SmArTeStChIlD421 · 06-26-2008, 11:38 AM

well even if they were only making $26.......they'd still be making a lot cuz these things always sell out real fast

spleck · 06-26-2008, 3:03 PM

It costs more than $26 to package, ship, and sell the iPhone. Hence the reason they cost more than $199 to AT&T.

06-25-2008, 2:23 PM	#1 (permalink)
SmArTeStChIlD421 Join Date: Jun 2006 Location: Reading, PA Posts: 3,639 Phone(s): Motorola RAZR V3m (Red) Provider(s): Sprint Thanks: 4 Thanked 2 Times in 2 Posts	Study: Apple Makes $26 Profit on Every iPhone 3G Study: Apple Makes $26 Profit on Every iPhone 3G 06.25.08 by Chris Gampat According to a preliminary analysis by iSuppli Corp., the new Apple iPhone 3G materials and manufacturing cost is $173. The initial retail price of the phone announced by Steve Jobs will be $199. iSuppli has performed a breakdown of the costs using insights from its analysis staff to develop estimates of iPhone content, suppliers, and costs. "The new iPhone is significantly less expensive to produce than the first-generation product, despite major improvements in the product's functionality and unique usability, due to the addition of 3G communications," said Dr. Jagdish Rebello, director and principal analyst for iSuppli. "The original 8Gbyte iPhone carried a cost of $226 after component price reductions, giving the new product a 23 percent hardware cost reduction due to component price declines." Tina Teng, wireless communications analyst at iSuppli, added that if the 3G iPhone design is unchanged, the cost should drop down to $126 in 2012. Study: Apple Makes $26 Profit on Every iPhone 3G - News and Analysis by PC Magazine __________________ SERO F&F 500: 500 Flexible Anytime Minutes, UNLIMITED Nights and Weekends (7PM), UNLIMITED Mobile to Mobile, UNLIMITED Power Vision, UNLIMITED Messaging (Text/Picture/Video), Pick 3

06-25-2008, 9:30 PM	#2 (permalink)
spleck Join Date: Apr 2002 Location: Middle GA Posts: 498 Phone(s): iPhone 3G, T-Mobile Wing Provider(s): AT&T, T-Mobile Devices: Garmin GPSMAP 76CSx, Canon EOS Rebel XTi Thanks: 10 Thanked 4 Times in 4 Posts Images: 18	Re: Study: Apple Makes $26 Profit on Every iPhone 3G Other sources have claimed that AT&T is paying $525 for the iPhone, plus $100 commission for phones sold from the Apple Store. The $325 subsidy was "more than 50% higher" than their standard subsidy of $200. I think whoever titled that article is an numbnut. There's so many more inputs to the equation that saying $26 profit based on material cost and the subsidized sale price is ridiculous.

06-26-2008, 5:30 AM	#4 (permalink)
Mobile Mike 4 years and counting... Join Date: Sep 2004 Location: Los Angeles, CA Posts: 4,653 Phone(s): LG Voyager, Nokia 6555, 6263 Provider(s): Verizon Wireless, AT&T, T-Mobile Thanks: 40 Thanked 18 Times in 18 Posts	Re: Study: Apple Makes $26 Profit on Every iPhone 3G In any case, Apple's riding high making a nice profit nonetheless... __________________ (1994-Present) LG Voyager at&t (2004-2005, 2006-Present) Nokia 6555 3G -T---Mobile- (2004-Present) Nokia 6263 3G

06-26-2008, 10:08 AM	#5 (permalink)
walkguru Wireless Guru Join Date: Dec 2005 Location: Oklahoma Posts: 6,069 Phone(s): nokia 6682, nokia 6230, moto,v600, moto,v551 Provider(s): cingular,family plan w/4 lines Devices: m3000,hs810, Sirius,sportster,w/boombox, Thanks: 10 Thanked 1 Time in 1 Post Images: 28 My Auctions	Wirelessly posted (Walkguru's: Opera/9.50 (J2ME/MIDP; Opera Mini/4.1.11328/534; U; en)) thier making more than 26 dollars i think. __________________ http://www.speedtest.net/result/90674468.png Men sleep peacefully in their beds at night, because rough men stand ready to do violence on their behalf ~George Orwell

06-26-2008, 11:38 AM	#6 (permalink)
SmArTeStChIlD421 Join Date: Jun 2006 Location: Reading, PA Posts: 3,639 Phone(s): Motorola RAZR V3m (Red) Provider(s): Sprint Thanks: 4 Thanked 2 Times in 2 Posts	Re: Study: Apple Makes $26 Profit on Every iPhone 3G well even if they were only making $26.......they'd still be making a lot cuz these things always sell out real fast __________________ SERO F&F 500: 500 Flexible Anytime Minutes, UNLIMITED Nights and Weekends (7PM), UNLIMITED Mobile to Mobile, UNLIMITED Power Vision, UNLIMITED Messaging (Text/Picture/Video), Pick 3

06-26-2008, 3:03 PM	#7 (permalink)
spleck Join Date: Apr 2002 Location: Middle GA Posts: 498 Phone(s): iPhone 3G, T-Mobile Wing Provider(s): AT&T, T-Mobile Devices: Garmin GPSMAP 76CSx, Canon EOS Rebel XTi Thanks: 10 Thanked 4 Times in 4 Posts Images: 18	Re: Study: Apple Makes $26 Profit on Every iPhone 3G It costs more than $26 to package, ship, and sell the iPhone. Hence the reason they cost more than $199 to AT&T.

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