Apple HomePod Costs Only This Much To Make
According to a recent report by Techinsights and Bloomberg, the HomePod costs around $216 to build and this is not a lot compares to what Apple is charging for. In comparison, Apple is making less money for the HomePod than they do on any of their other devices.
iPhone 8 costs about $247 for Apple to make and the device sells for $699, the iPhone X which sell for $999 is estimated to cost around $357 to make. This suggests that Apple has a much lower profit margin for the HomePod than its other gadgets.
There could be a couple of reasons why Apple did not price the device higher, Apple is looking to get more people to sign up to Apple Music and is hoping that the HomePod will help them do exactly that. Also, there is fierce competition in smart speakers like the Amazon Alexa and the Google Home devices which sell for less than the HomePod, so they already have to compete with the Titans.