The 64 GB base model iPhone X sold at $999 by Apple only costs $357 to make as noted by Reuters. In addition to that, Apple gets a whopping 64 percent of gross margin on single iPhone sold.
iPhone X consists of expensive parts such as OLED display that costs Apple around $65.5, stainless steel chassis costing Apple around $36 which is also very expensive compared to iPhone 8 production cost. The 4.7 inch iPhone 8 LCD display cost only $36 for Apple and only $21.5 for the aluminum housing.
During Apple’s earning call held last week, Tim cook commented on iPhone X’s higher price point mentioning that the company only charges price for the value consumer get.
In terms of the way we price, we price to the sort of the value that we’re providing. We’re not trying to charge the highest price we could get or anything like that. We’re just trying to price it for what we’re delivering. And iPhone X has a lot of great new technologies in there that are leading the industry, and it is a fabulous product and we can’t wait for people to start getting it in their hands.
Remember, $357 is only the production cost of iPhone X. Apple also spends lots of money on Research and Development that are not included with this cost.
