An interesting take from Citigroup analyst, Oliver Chen, on Apple’s rumored smartwatch this evening. Relayed by Bloomberg, the comments made by the analyst this week appear to indicate that the gross profit margins on watch hardware are currently considerably higher than the gross profit margins seen on the sale of television sets.
With this number currently thought to reflect somewhere close to 60 percent, Chen has reportedly taken this view of the markets and formed his own prediction, in which the analyst suggests that – if Apple’s smartwatch ever does see the light of day – it could one day potentially make upto four-times more profit for the company than sales of an Apple-branded television set ever could in today’s market.
Describing the watch as a potential $6 Billion opportunity for the firm, Chen wrote:
“This can be a $6 Billion opportunity for Apple, with plenty of opportunity for upside if they create something totally new like they did with the iPod — something consumers didn’t even know they needed,”
If his view of the market is accurate, this could potentially put the rumored wrist-worn product right up there with the iPhone and iPad, becoming a brand-new flagship product line for the company.
We guess only time will tell in regards to exactly how successful Apple’s smartwatch will be, and how quickly it will be adopted by existing customers. According to Bloomberg, though, we might not have too long to wait before we get that answer — as the publication currently reckons the product could actually be on shelves before the end of this year.
/ AppleInsider (h/t)