A new report revealed the profit margins of the Google Pixel Watch, and it appears that Google is taking in a lot more than its competitors.
According to a report by Counterpoint Research, it costs Google $123 to build a single Pixel Watch (specifically, the 4G LTE variant), which Google charges $400 for. When compared to the profit margins of similar devices, Google seems to have some explaining to do.
Obviously, a company like Google has to make money, but the profit margin of 69% seems a bit steep. Apple, which is known for the highest profit margins in the mobile industry, had profit margins of 66% for the Apple Watch Series 6, which initially sold for $400. While that’s only 3% less than Google’s margin, Apple Watches are able to better justify their price thanks to the “higher integration of internal hardware and software,” notes Counterpoint.
However, the current crop of Apple’s flagship watches can’t compare to the Pixel Watch. In terms of features and quality, it’s more accurate to compare the Pixel Watch to something like the Apple Watch SE 2, which retails for $250, or the Galaxy Watch 5, which retails for $280. When viewed from this perspective, Google pays less than its competitors to make its smartwatches, but charges over 30% more for that.
At the end of the day, there isn’t much that can be done to get Google to lower their prices. However, it can help potential Pixel Watch buyers be more aware of exactly what they’re buying. As mentioned earlier, high profit margins are an industry standard, especially when it comes to Apple hardware, but the level of quality isn’t quite there yet for the Pixel watch.
It’s also worth noting that nothing here is intended to dissuade anyone from buying a Pixel Watch if they feel it’s the right device for their life. It’s always a good thing when consumers make informed purchases.
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