3 ms·

Not sure what your definition of "that much money" is :-) The margins are estimated to be ~37% - ~50% depending on the model. http://www.isuppli.com/Teardowns

• seanmcdirmid 14y ago
  Somewhere definitely north of 30%, 40% for high end devices. Keep in mind apple has its own retail distribution, so there is no middle cut (they offer very little to resellers like best buy). Apple has room to cut prices if they want, I don't think anyone else does though.
• nilsbunger 14y ago
  It's hard to run a hardware business at less than 35% gross margins. There are a lot of extra costs besides the bill of materials and assembly. 37% for apple might only be 25% for any other competitor, because apples supply chain is so streamlined and locked down. So it's hard to compete with the base iPad on price. At 50%, you are right, there could be room to undercut, but that's only the high-end iPad (eg 64gb) which isn't where the volume is. iPhone margins are much better, and thus leave more room for others to undercut or offer feature parity.