Apple Pricing Power
Rumor has it $AAPL will be raising the price of the new iPhone to all-time highs today at their event

This has me thinking: How much pricing power does Apple have before it destroys its own demand?

Obviously it isn't infinite, but it is clearly high
Nathan Worden's avatar
There’s only one way to find out how much pricing power you have— and that’s to raise prices until you see demand fall. My guess is they raise again today
Brett Schafer's avatar
@nathanworden Agreed. I think the premium product will get close to $1.5k within the next few years
Alex Biestek's avatar
@nathanworden Great point! Crazy thing is, people are willing to throw down heavy coin for their products. IMO, they will always raise the price and the demand will always be there. They create some of the most sought out devices in the world (and I think they're just getting started!)
Nathan Worden's avatar
@acb123 Yeah, once a product becomes as essential to modern life as the iPhone has become, the product takes preference over virtually every other disposable-income purchase. Massive pricing power right there.
Isaac Melin's avatar
I think the can raise prices continually. There will always be a market for their newest, highest/end phone (not me, but I know people). So long as they continue also putting out lower tier models that are less expensive on a relative basis but more expensive on an absolute basis, I think they’ll be able to continue raising prices.

The biggest risk is if their ecosystem falls apart or becomes less valuable to future generations, which is always possible.

Disclaimer: This is an opinion with no research whatsoever.
Brett Schafer's avatar
@melonsmangos I think that is correct. Might not be a one size fits all
Alex Biestek's avatar
@melonsmangos Love the disclaimer. I need to start doing that haha
Rihard Jarc's avatar
$100 for each new button on the watch or camera lens on the phone ;)
Rihard Jarc's avatar
@ccm_brett haha. What is your camera lens demand elasticity :D
Joshua Simka's avatar
Apple has shown they have a great deal of pricing power. The ecosystem is sticky and that's beautiful for investors.