Apple could make 100% margin on Apple VR

The Apple VR headset has long had a rumored price of around $3000 – a lot of money. How Apple would make any profit from it, however, remained to be seen; but now, thanks to a component breakdown spotted from Brad Lynch on Twitter, we know how much each unit will cost to produce.

Using a Chinese analyst source, Lynch puts the bill of materials at around $1500 – $1600, and if the price is right, that would double Apple’s money every time someone buys one. If customers buy one.

Apple VR costs and profits

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Apple likes its high product margins. iPhones, apparently according to Lynch, cost around $500-$600 to produce, with Apple almost doubling the price when they go to store shelves. This price rumor would therefore line up pretty well with previous margins, and give the $3000 price point some more meat to its bones.

Putting a proverbial spanner in the works however is Bloomberg, which says that the Apple VR headset will be sold ‘at cost’ and make Apple ‘little to no money’ with each headset sold. On the surface, this would seem to be completely at odds with this bill of materials – although there is more to consider with profit margins.

(Image credit: Wellsen XR)

The Bill of Materials (BoM) is just one part of the production of the Apple VR headset. One still has to take into consideration the building of the unit itself, the rent of the store it will be sold at, and the development cost of the unit over the long period that it’s been brewing in the design rooms at Apple. It could well be that while it would appear on the surface to be a massive margin, it could be nothing at all once everything else is added on top.

What’s interesting here as well is that the BoM of the Apple VR is almost double that of Meta’s Quest Pro – which was only $800, including the touchpad and controllers. Apple VR is going to be an expensive thing.

Apple VR, or Reality Pro, is expected to be announced at WWDC 2023 in a couple of weeks, so we’ll soon see what the headset looks like and understand more about how it works – and how much it will cost.



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