No, Apple Watch won’t be more profitable than the iPhone

“The Apple Watch is selling briskly, and at least one Wall Street analyst thinks it’s going to be a major driver for Apple’s bottom line,” Rick Munarriz writes for The Motley Fool. “CLSA’s Avi Silver feels that the game-changing smartwatch will eventually become Apple’s most profitable product line.”

“There’s no denying that the Apple Watch is a hit, even though it has run into a few bumps early on. However, it seems a bit extreme to think that it will be more profitable than the iconic iPhone,” Munarriz writes. “The Apple Watch is highly unlikely to ever sell as well as the iPhone, especially as long as it’s restricted to owners of the more recent iPhone models.”

MacDailyNews Take: With new iPhone due in four months, that’s a situation that simply will not matter for very long.

Munarriz writes, “The assumption that the Apple Watch will ever be as profitable as the iPhone — whether we’re talking about total earnings or even profit margins — will probably never be true.”

Read more in the full article here.

MacDailyNews Take: Tellingly, Munarriz inserted a “probably” before his “never.”

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

SEE ALSO:

Analyst: Apple Watch to become more profitable than iPhone – May 28, 2015

12 Comments

    1. Do you remember a rather large and sweaty man saying this ?

      “There’s no chance that the iPhone is going to get any significant market share. No chance. It’s a $500 subsidized item.”

    2. Yes, in this economy perhaps a $400 watch is a frivolity.

      But an Apple Watch is not a mere watch. For many people, its additional functionality can justify the cost. I think Apple has once more added an important new member to its hardware/software products that will sell very well.

      Mine was delivered two days ago. I’m pleased. 🙂

    3. You have to stay up-to-date with technology. Being an early adopter means you won’t be left behind. Sure it’s easy to dismiss right now, but technology grows at an accelerating exponential rate, and soon the difference of resisting progress forward will mean resisting evolution. Not long from now technology will merge with biology, and apple watch is a step in that direction with a direct and constant interface into our biology through understanding our heartbeats and calories burned, etc. it’s primitive right now but still working toward that goal. We’ll be advancing ourselves and not just things around us. When it gets to that stage and I’m suddenly able to think 100 times more powerfully than you are because I spent the money on blood cell nanobots or synapse replacement, etc, then will you be saying “in this economy it simply isn’t an option and I would rather spend the same amount of money dining out for a week”?

  1. The Apple Watch is compatible with the iPhone 5c. How many iPhone 4s units do you see out there? Like… seriously.

    Though I agree that it won’t outsell the iPhone, profit margins may be greater than the iPhone. I guess we’ll find out in a couple of months, won’t we?

  2. Until they find a reason to charge a monthly fee to use this thing it will be dwarfed by the phone business. This business should be compared to iPod , not iPhone. iPhones bring Apple 500-700 dollars apiece once they are paid for.

    1. I can totally see the watch taking over from the phone.
      In the future it could be
      The watch will connect to your cars WiFi;
      The watch will connect to your home WiFi;
      or for that matter an WiFi connection anywhere it is available.
      Plus it will at some point become a standalone phone on your wrist. Then the iPhone will no longer be needed.
      The watch will monitor your heart , pulse , blood glucose and who knows what. It will become your Life Alert device. The list goes on and on.

      1. I agree with all of what you wrote .
        Im already addicted to my watch .
        But at the same time i dont see the watch as a convenient primery tool for writing emails, relatively long texts and browsing ..
        Sure the watch will become more capable Independantly.. But i see iphone remaining as a hub for matters of practicality.
        At least for a quite a few years ..

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