iPad mini profit margin is "significantly below" Apple's average
posted by Michael H. / Oct 25, 2012, 5:45 PM
Apple's Chief Financial Officer Peter Oppenheimer said that although the iPad mini is being sold at a much higher price than direct competitors like the Google Nexus 7 or Amazon Kindle Fire, the mini's gross margin is "significantly below" the company's average. Unfortunately, Apple didn't elaborate on this at all, so we are left to speculate.
It seems reasonable that the aluminum casing of the iPad mini would cost more than the competition's plastic/rubber. Other than that, we're having trouble seeing the big differences. The iPad mini is using a 2 year old CPU, where the Nexus' Tegra is only a year old. Both the Nexus and Fire have smaller displays, but higher resolutions, so the display cost might not be too different between them and the iPad.
Of course, the Nexus and Fire are both sold at cost, while the iPad Mini will be making something of a profit. Just how much of a profit should be revealed when the teardowns start coming next week.
It should be noted though that one of the main complaints against Apple has been that the company overcharges and tries to suck as much profit from customers as possible. Given this news, and the news that Apple collected less in profits for the 3rd straight quarter, it may be that the company is scaling back in the Tim Cook era. Still a bit too soon to judge, but it's something to keep an eye on.
source: The Verge
Posts: 4721; Member since: May 17, 2011
is brand recognition.. is what the Apple logo represents to people that is not included on those comparison
posted on Oct 25, 2012, 5:53 PM 2
You make a big mistake Mr. Cook, if you think you can convince us that iPad is better because of bigger screen than nexus 7 you are wrong. We don't wanna low resolution display. you also an Apple user and you must know by now that we want quality (brightness) not quantity (big-ness)
posted on Oct 25, 2012, 6:00 PM 4
Posts: 2734; Member since: May 26, 2011
Keep in mind that the whole point of the resolution being as it is is to avoid compatibility troubles with tablet apps in the App Store. Everything will automatically work, because this is the same resolution and same aspect ratio as the iPad 2, just on a smaller screen.
posted on Oct 25, 2012, 6:14 PM 2
The whole point of a 7" tablet is compact-ness (if thats even a word) and being priced low. Apple put a screen size bigger than its competitors and priced it "premium". Add to that, old hardware. You surely don't expect to be a success, right?
posted on Oct 25, 2012, 6:06 PM 3
Posts: 506; Member since: Apr 22, 2011
I like to take a guess iPad Mini 16GB $330 - $50 profit (not bad) iPad mini 64GB 4G $830 - $200 profit (bad)
posted on Oct 25, 2012, 6:37 PM 0
Posts: 176; Member since: Nov 17, 2011
When I saw the iPad mini price I thought "Wow, that actually seems reasonable". Then I saw the specs. Then I remembered that it's Apple so $330 is still kind of reasonable. But that's only the 16GB WiFi version, when you go up in storage the price goes up 100$, plus another 100$ if you want cellular, that's a lot.
posted on Oct 25, 2012, 9:11 PM 2
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