"Take a look at this iPhone 16 Pro. Your cost, for the 256GB version, is $1,100. The cost of all the hardware inside—aka the bill of materials—was about $550 to Apple when the phone was introduced, says Wayne Lam, research analyst at TechInsights, which breaks down major products. Throw in assembly and testing and Apple’s cost rises to around $580. Even when you account for Apple’s advertising budget and all the included services—iMessage, iCloud, etc.—there’s still a healthy profit margin.
Now factor in the newly announced tariff for goods from China, which currently totals 54%. The cost rises to around $850. That profit margin would shrink dramatically if Apple didn’t up the price. And you don’t become a trillion-dollar gadget company by charging for things at cost."
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“Analysts from Rosenblatt Securities said in a note Thursday that Apple would need to increase prices for several products to offset an estimated $39.5 billion in costs from tariffs as the company relies heavily on China-based manufacturing, including a 43% price increase for iPhones and Apple Watches, a 42% increase for iPads and a 39% hike for Airpods and Mac computers. Apple released a cheaper iPhone model in February with a $599 price tag, which would increase to about $856 after a 43% increase, while its pricier $1,599 iPhone 16 Pro Max would jump to $2,300.
About 80% of the coffee beans imported into the U.S. come from Latin America, and most coffee imports come from Brazil (35%) and Colombia (27%) as of 2023, according to the Department of Agriculture, as both countries face tariff rates of 10%.”Yes, but: the rich won’t pay any taxes. So, great win for everyone.