Homepod cost apple $216 to make margin smaller than Amazon echo and Google home

HomePod cost Apple $216 to make, margin smaller than Amazon Echo & Google Home

The HomePod’s $349 price point was somewhat controversial last summer when Apple announced the device, especially in comparison to its competitors in the market. A new report from Bloomberg, however, shows that Apple is operating at smaller margins than its competitors… According to the report, which cites analysis by TechInsights and IHS Markit, the HomePod costs Apple $216 to build.

With the device retailing for $349, Apple is operating at a 38 percent margin – which is significantly smaller than the margins on iPhone and Apple Watch. For comparison’s sake, Google sells its Google Home smart speaker at a 66 percent margin, while the Amazon Echo is sold at a 56 percent margin. It’s incredibly unusual for Apple to sell its products at margins smaller than its competitors, but the sound and microphone equipment within the HomePod is driving that price up.

The microphones, tweeters, woofer, and power management parts inside the HomePod are said to cost Apple $58 in total, while the lighting system used to display the Siri animation and other smaller parts make up an addition $60. From there, the A8 chip costs $25.50 and housing and other items tack on an additional $25. Lastly, “manufacturing, testing, and packaging” cost $17.50.