Apple Vision Pro is quite expensive to manufacture

Apple vision pro is a very costly product to manufacture. Its price tag, $3,499, hardly covers half of its expenses. If we compare this headset to others in the market, Apple vision pro is high performance and ships in with a high price tag. The $3,499 Apple charges is eye-watering to consumers, yet it is necessary for Apple to pay component suppliers a sizeable portion of the proceeds.

According to an Omdia researcher’s estimate of the “bill of materials” for the Apple Vision Pro, which CNBC was given access to, the cost of each headset’s components is approximately $1,542. Approximately 44% of the headset’s cost is covered by this.

This amount solely accounts for the manufacturing of each headset; it excludes any additional expenses Apple might have for marketing the device to the public or recovering R&D expenditures. As for the material bill, it’s pretty high compared to other headsets including Meta Quest Pro that was $999 or $1,499 at the time of its launch.

According to Omdia, the two micro-OLED displays in the headset, which are supplied by Sony and cost $228 each are the most costly component. The screens are perhaps the most crucial components since they offer the high resolution and excellent visual quality that Apple requires for the product, with an average of 3,380 pixels per inch. Additionally, the cost of the displays exceeds that of the chipsets that power the experience. The M2 chip and the unique sensor-managing R1 chip are part of the chipset, which comes in second.

Even though the first-generation headgear is expected to generate very little profit, Apple can afford the extremely high cost of production for each one. Future model updates are anticipated, along with improvements in component manufacturing and the advantages of economies of scale, so Apple might be able to reduce the cost of hardware with each device. For the initial model of Apple vision Pro, it doesn’t feel profitable, but it can be expected with later models.