Analyst: iPhone profits have ‘likely peaked’

Analyst: iPhone profits have ‘likely peaked’We’ve hosted plenty of Apple-related negativity on our hallowed pages of late. Over the weekend, we heard a former engineer describe Apple’s web services as a “clusterf*ck”.

Worse still, Apple’s stock is taking a bit of a bashing, and now some analyst guy is telling us that the Californian manufacturer’s profit per unit on the iPhone has – in all likelihood – “peaked”. Sucks to be Apple.

The latest slice of depressing Apple news comes from Pacific Crest analyst Andy Hargreaves, as reported by Forbes.

Hargreaves has raised his estimated cost of goods sold for building the iPhone 5 from $353 to $370, bringing the gross margin down from 40% to a paltry (ahem) 38.8%.

Looking back over the iPhone’s relatively short five-year history, Hargreaves notes that Apple’s gross profit per unit rose from less than $150 to $290.

However, the glory days, we’re told, are probably over. The iPhone has an increasingly complex set of internals, lately embracing 4G LTE, and we’ll probably see NFC (Near Field Communication) on the iPhone 5S.

Unfortunately for Apple, it’s not exactly in a position to jack the price of the iPhone, with stiff competition from the likes of the quad-core, 2GB of RAM Google Nexus 4, which goes for £239 on Google Play. Er, when it’s in stock.

Read more about: Apple iPhone 5iOS

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2 comments

Stelph  Nov. 27, 2012 at 16:55

I agree, I think at the very least we will see the iPhone 4 price hold steady now (after the price hike for the 5) or maybe even be cut if they can't come up with an compelling feature next time (the screen size and case will stay the same for the 5s remember)

I wonder if the pressure from the nexus 4 will encourage the rumoured "cheap" iPhone so that apple can justify the high price of their "top spec" phone

mrjibbles2  Nov. 29, 2012 at 12:38

The more phones they make the more they saturate their own market.

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