Sam Oliver
Apple CEO Tim Cook took supply chain "guesstimators" to task on the company's second-quarter earnings call earlier this week, but that did not stop one firm from moving ahead with its own analysis of Apple's new wearable device.
IHS Technology tore down the 38-millimeter Apple Watch Sport, estimating that its total component cost comes out to just $83.70, as noted by ZDNet. The aluminum model retails for $349.
The LG-manufactured OLED display assembly and Analog Devices touchscreen controller combined for the highest part cost at $20.50 per device. The internal application controller is thought to come in at $10.20, while $7.20 is allocated to memory and $5.50 to power management.
Wireless interfaces add a further $3 to total, with audio and NFC devices accounting for $5.50 and sensors at $3.
The Watch's battery is estimated at an almost laughably low $0.80, while "other mechanical / electro-mechanicals," like wristbands and switches, add $16.50. IHS estimates the cost of packing and the new inductive charger to be $9.
Not included in the bill of materials estimate was outlay for research and development, marketing, or other expenses.
On Monday, Apple's chief executive said he had never seen such an analysis that was "even close to accurate." His testy response was prompted by questions about perceived weakness in the Apple Watch's launch margins.
Charles Martin
Christine McKee
Wesley Hilliard
Malcolm Owen
Andrew Orr
William Gallagher
Sponsored Content
34 Comments
80¢ for the battery? Do they just make the numbers up? What evidence is that based on?
[quote name="LighteningKid" url="/t/186070/undeterred-by-tim-cooks-browbeating-supply-chain-guesstimators-soldier-on-with-apple-watch-appraisal#post_2718335"]80¢ for the battery? Do they just make the numbers up? What evidence is that based on? [/quote] They look for the cheapest one they can find. Or they just throw stuff at a dartboard. A 1000 cycle battery is not .80.
I don't see a line item for all the custom machining, or equipment used to perform that machining.
And the average adult human being is probably worth $63.57 in raw atomic elements. /s
They always seem to forget about the years of research and designing that went into each product.