Which Apple (AAPL) Accessory Could Drive $1B in Revs?
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The big news for Apple (Nasdaq: AAPL) over the weekend was the launch of the new iPad 2. What was less news, but should still be scrutinized by analysts as much as the iPad 2, is the Smart Cover that Apple debuted on the same day as the tablet.
One estimate, based on research from asymco, says that Apple's simple yet useful cover for their new tablet will generate about one billion ($1 billion) in revenues for the company over the next several months. That's noteworthy!
To get to the number, the researcher assumes that about 60% of iPad 2 buyers will get a Smart Cover. With 36 million iPads expected to be sold globally, and a retail of $48 for the cover, the revue stream easily tops the $1 billion mark. (Note: the design of the Smart Cover includes strategically-placed magnets that don't make it as useful for the original iPad though owners may want to pick one up anyway. That potential isn't included in the calculations.)
However, there is a cost to produce the accessory, and with asymco looking at a gross margin of 75%, the number is still $777 million.
Customers buying the iPad 2 and Smart Cover together will increase gross margin by 200 basis points for Apple.
Click here for more color and analysts for potential opening weekend sales
figures for the next generation tablet device.
One estimate, based on research from asymco, says that Apple's simple yet useful cover for their new tablet will generate about one billion ($1 billion) in revenues for the company over the next several months. That's noteworthy!
To get to the number, the researcher assumes that about 60% of iPad 2 buyers will get a Smart Cover. With 36 million iPads expected to be sold globally, and a retail of $48 for the cover, the revue stream easily tops the $1 billion mark. (Note: the design of the Smart Cover includes strategically-placed magnets that don't make it as useful for the original iPad though owners may want to pick one up anyway. That potential isn't included in the calculations.)
However, there is a cost to produce the accessory, and with asymco looking at a gross margin of 75%, the number is still $777 million.
Customers buying the iPad 2 and Smart Cover together will increase gross margin by 200 basis points for Apple.
Click here for more color and analysts for potential opening weekend sales
figures for the next generation tablet device.
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