Apple’s new OLED iPhone 8 is unlikely to cost over $1,000, according to a new report from UBS. This contradicts an earlier report.
In a research note obtained by CNBC, UBS says the 64GB iPhone will likely cost $70-$90 more than the iPhone 7 Plus.
UBS said the factory cost of the 64GB OLED iPhone will be $70 to $90 higher than the iPhone 7 Plus model with a sale price of between $850 and $900. The higher cost could weigh on Apple’s gross margin which UBS said is likely to decline to 38.5 percent in the fiscal 2018 year, from its estimate of 38.7 percent for the current fiscal year. But the 64GB OLED model priced at $870 would be good for earnings.
“We think an $870 price would be accretive to EPS but dilutive to gross margin, a dynamic Apple has said it would accept,” UBS noted.
UBS expects Apple’s earnings per share for 2018 to be $10.55, up from a previous estimate of $10.25. The average selling price of the iPhone is also expected to rise from $667 to $692.