Here is why Warren Buffett believes the iPhone is 'enormously underpriced'
Buffett said that Apple cannot currently increase the price of the iPhone due to competition in the market.
August 31, 2018 / 08:12 PM IST
Warren Buffett believes that the iPhone is “enormously underpriced” and worth much more than the current price tag of $1,000 (Rs 1,02,000 for the 256GB version).
"I have a plane that costs me a lot, a million dollars a year or something of the sort. If I used the iPhone — I use an iPad a lot — if I used the iPhone like all my friends do, I would rather give up the plane," he told CNBC.
Buffett said Apple cannot currently increase the price of the iPhone due to competition in the market. "Now it's got competition so you can't push the price, but in terms of its utility to people and what they get for a thousand dollars... you can have a dinner party that would cost that, and here this is, and what it does for you, it's incredible," he said.
His company, Berkshire Hathaway, increased its stake in Apple by five percent in the second quarter. Buffett invests in Apple not for the financial gains but due to its brand power.
"I do not focus on the sales in the next quarter or the next year," he said. "I focus on the ... hundreds, hundreds, hundreds millions of people who practically live their lives by it [iPhone]," he said.