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The Apple watch costs about 85$ to make

RagnarokDel

That shiny new Apple Watch Sport may have set you back $350, but from a hardware and manufacturing standpoint it only cost Apple $83.70.

 

According to a teardown carried out by IHS Technology the actual hardware costs of the 38mm Apple Watch Sport are only about 24 percent of the manufacturer's suggested retail price, giving it the lowest hardware costs compared to retail price of any Apple product.

 

"It is fairly typical for a first-generation product rollout to have a higher retail price versus hardware cost," said Kevin Keller, senior principal analyst-materials and cost benchmarking services for IHS Technology. "While retail prices always tend to decrease over time, the ratio for the Apple Watch is lower than what we saw for the iPhone 6 Plus and other new Apple products, and could be of great benefit to Apple's bottom line if sales match the interest the Apple Watch has generated."

 

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A view of the parts in questions.

 

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Source: http://www.zdnet.com/article/apple-watch-costs-under-85-to-make/

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I'm not surprised.

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I'm pretty sure they have other costs. So yeah while Apples gross profit figure is probably insanely high, they will also have a fair amount of expenses. What I'd really be interesting in seeing is Apples advertising expenses.

 

 

How about the Watch: Edition though  :)

 

 That gold definitely adds like 5k...

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I'm pretty sure they have other costs. So yeah while Apples gross profit figure is probably insanely high, they will also have a fair amount of expenses. What I'd really be interesting in seeing is Apples advertising expenses.

 

yeah I mean imagine what it cost designed new metals, and a rounded sapphire display etc! and all the prototyping

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As soon as I saw this I was not surprise in the least bit. Most of that money for the R&D and even then they are probably making 20% profit.

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With R&D, this isn't surprising nor should it be.

 

I wonder how much smaller the margin on the sapphire variant is, and how much bigger the margin is on the gold variant.

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Blame inflation. This is just dumb.

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Also they have the ongoing costs of maintaining servers for things like the various stores and iCloud. I'm sure they still make a fair amount of profit though.

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LOL this is a joke. Everyone knows that Apple only sells supreme quality products. And they care about the their business. They care about me. Samsung on the other hand sells way OVERPRICED products and makes them in gold because they think that is what is important... loosers.

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not really surprised. In our current market labor is expensive and parts are cheap. go back in time 50-60 years and it was just the opposite. People with no understanding of business will squeal in anger when they find out they bought something with a 1000% markup, but fail to consider that there is overhead everywhere that the customer is not made aware of. Granted, Apple have pretty high profit margins anyway, so it looks a whole lot worse with their products.

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and a rounded sapphire display etc!

There's no sapphire glass it's just the cheap sports version.

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There's no sapphire glass it's just the cheap sports version.

 

I know, I meant the cost of building and developing the sapphire for the high end models, and creating a new tougher gold etc that stuff costs money

 

obviously they are making a decent profit still, but BOM costs are only a small part of what a product costs to produce

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I know, I meant the cost of building and developing the sapphire for the high end models, and creating a new tougher gold etc that stuff costs money

 

I think that's all done by Apple's suppliers thus they aren't paying a single cent for the the initial development.

The development costs should be included in the parts costs.

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I think that's all done by Apple's suppliers thus they aren't paying a single cent for the the initial development.

The development costs should be included in the parts costs.

 

That makes no sense... the products are being built to apples specs and designs - they are not just buying products off the shelf (well some tiny components maybe, but everything else is paid for by Apple

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want to know how much is the profit margin is after all the other costs

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I think that's all done by Apple's suppliers thus they aren't paying a single cent for the the initial development.

The development costs should be included in the parts costs.

I heard Apple didn't even spent a cent developing the Watch.

They just bought it from Samsung and now they are selling a $85 gadget for $350 and make $265 per watch!

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want to know how much is the profit margin is after all the other costs

wait some months and look up apples financial reports.

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wait some months and look up apples financial reports.

was thinking about direct costs like how much R&D and advertising was put into this

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the products are being built to apples specs and designs - they are not just buying products off the shelf

That makes no sense... the suppliers can use the gained know how to produce products for other companies which was initially payed by apple.

Win-Win

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I guess that's what android wear devices were missing: 600 bucks per device on average of advertisement so people actually know about your fucking product. That's the one thing that others need to learn about to compete with Apple: marketing.

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That's pretty acceptable I would say.

I hope nobody thinks that the difference between manufacturing cost and selling price is the profit.

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id rather know how much they spent on advertising 

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That makes no sense... the suppliers can use the gained know how to produce products for other companies which was initially payed by apple.

Win-Win

 

Well that is what patents are for so people cannot steal your ideas. Apple developer the design and manufacturing process, and pay lots (millions if not billions) to get the stuff designed, R&D, get the tooling and manufacturing in place etc, sure lots of it is done by 3rd parties but all using apples designs which Apple pay them to use etc

 

You seem to think apple just go to Foxxcon,  pick parts off the shelf and ask them to put them together.. which is 100% NOT what happens

 

 

I guess that's what android wear devices were missing: 600 bucks per device on average of advertisement so people actually know about your fucking product. That's the one thing that others need to learn about to compete with Apple: marketing.

 

Well if nobody knows about your device, or nobody cares about it, nobody will buy it - specs are meaningless if nobody wants it

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