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In brief: Even when adjusting for inflation, the prices of today's high-end iPhones are much higher than they were over a decade ago—by 66%, in the case of the most expensive model. But CEO Tim Cook thinks that's okay because people are willing to pay more to "get the best."
Insider notes that when the iPhone 3G and 3GS launched in 2009, the latter model with its maximum storage and no contract cost $699, or $962 when adjusting for inflation. That's a lot less than the top-specced iPhone 14 Pro Max, which, when bought with 1TB of storage, costs $1,600, or 66% more than the iPhone 3GS.
The publication writes that prices have been on the rise for years; Apple has often been accused of increasing the cost of its products at a higher rate than inflation. The iPhone X's $1,149 launch price would make it around $1,376 today, though one exception was the iPhone 12 Pro Max, which sold for $1,399—$100 less than the iPhone 11 Pro Max.
Paying $1,000 or more for a product is a significant outlay, but Cook believes consumers are willing to spend this much because phones have become "so integral into people's lives." When asked if handsets' increasing average sales price over the last few years is sustainable, the CEO said, "I think people are willing to really stretch to get the best they can afford in that category."
Cook was answering questions related to Apple's recent quarterly earnings report, one of its worst in years. iPhone revenue was down to $65.8 billion in Q4 compared to $71.6 billion during the same period a year earlier. Overall, the three-month period ending December 31, 2022, saw the largest dip since 2016, and it was the first year-to-year sales drop Apple experienced since 2019.
Apple is unlikely to be worried about its latest financial report. Cupertino is still the largest company in the world in terms of market capitalization, which is currently $2.444 trillion after hitting $3 trillion last year. And at a time when most of the tech industry is cutting staff numbers as the economy falters, Apple is one of the few to have avoided making layoffs—Tim Cook even took a 40% pay cut at his own request.
Masthead: Ryan Tir