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iPhone Teardown Finds 55 Pct Profit Margin

iPhone Teardown Finds 55 Pct Profit Margin

Now that the traffic at Apple’s cash registers has slowed down and the lines of people anxious to leave $600 in the stores have left: it’s time to ask the question that everyone’s wondering: Just how much money does Apple make with the sale of every iPhone? According to iSuppli, a market research firm that has done the math – a lot.

After tearing down the iPhone and totaling the cost of its components plus estimated manufacturing costs, iSuppli calculates that the phones cost Apple around $265.83 apiece to make – leaving the company with a jaw-dropping profit margin of 55 percent.

The new data quickly makes it apparent why Apple didn’t hold back supplies to create an artificial shortage at the phone’s launch: every iPhone sold netted the company around $330 in profit. With over 500,000 phones sold in just the first weekend, the iPhone launch looks extremely successful from a financial point of view. If estimates of the phone’s cost and initial sales are correct, Apple lined its pockets with at least $165 million in a matter of days.

News of the iPhone’s lucrative potential sent traders scurrying for Apple stock on Tuesday. Shares went up $5.91, or 4.9 percent, to $127.17.

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