Fun (and Fudging) with Numbers and Apple

I see what you did there...

I generally try to avoid “insider baseball”—that is, news about lawsuits and financials and such that don’t have a direct or immediate impact on the end user. But this end user has come across two stories about Apple’s record-breaking profits that I feel compelled to comment on, if only to debunk them.

The first is a video by the newly-rebranded YouTube channel Coldfusion, which centres around the $619.77 USD profit that Apple makes on each and every iPhone 6. For the 6 Plus the per-unit profit is even higher, at $711.75 USD. These numbers were reported by Business Insider around this time last year.

If you’ve eleven minutes to spare, here is that video:

So iPhones are overpriced? No argument here. Ditto for Samsung, and even Nexus as of late. What’s more important is that the cited profit figures don’t take into account the gobs of cash that Apple spends on marketing and its worldwide retail operations—and also the Genius Bar that will fix your phone for you so that I don’t have to. 😛

Over on r/Apple a redditor wondered how you would have fared had bought you bought Apple stock in place of each iteration of the iPhone. The results are fairly interesting:

Model Date Released Base Price AAPL then # of Shares AAPL now Current Equity
iPhone 6/29/2007 499.00 17.43 28 116 $3248.00
iPhone 4 6/24/2010 650.00 ~37.00 17 116 $1972.00
iPhone 4s 10/14/2011 650.00 57.12 11 116 $1276.00
iPhone 5 9/21/2012 650.00 98.12 6 116 $696.00
iPhone 5s 9/20/2013 650.00 68.16 9 116 $1044.00
iPhone 6 9/19/2014 650.00 102.35 6 116 $696.00

Had you spent $500 USD on AAPL instead of an iPhone in 2007 you’d have more than six times the equity in 2015. But presumably you also wouldn’t have had a smartphone for eight years so, you know, there’s that. 🙄

TL;DR Insider baseball is dumb. Nothing to see here.

Sources: Business Insider, reddit

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