Apple Inc. (NASDAQ:AAPL) officially unveiled the iPhone 6 and iPhone 6 Plus last week. The new smartphones were given a nice size boost at 4.7 inch and 5.5 inch respectively. Now it is speculated Android switchers may flock to Apple thanks to the larger smartphones.
Samsung may lose to Apple
For the longest time, Samsung dominated the phablet market thanks to high-end devices like Galaxy S5 and Galaxy Note. Michael Walkley, analyst for Canaccord, believes Apple’s latest launch could have a serious impact on Samsung phablet sales. Walkley added that Samsung capitalized on the large smartphone market early on, delivering on a consumer demand. Now that Apple has entered the arena, consumers have more choices.
Previous surveys indicate a significantly large number of Android users would be willing to trade up for the iPhone 6. The iPhone 6 is a key product for Apple and quite the upgrade, which is a great thing considering how many speculate it will turn a huge profit for Apple.
A closer look at Apple iPhone 6 price
A recent report from research group IHS points out it costs Apple about $200 to make the iPhone 6 and $216 to make the iPhone 6 Plus. With these costs, it is likely for Apple to maintain gross profit margins of at least 70%, the highest in the market. It is the same profits that make Apple one of the most successful tech companies. Unfortunately, those margins have decreased in the past few years thanks to material cost.
According to the IHS review, iPhone 6 costs $5.00 more to build than the iPhone 5S from last year. That model initially retailed for $649 sans the contract, but that’s now the current price for the iPhone 6. This teardown actually follows a similar appraisal from iFixit posted last week. This report uncovered component manufacturers like Qualcomm and NXP.
Apple could possibly capture higher margins with the iPhone 6 Plus.