But the shocking news is that it only costs $83.70 to make.
IHS said the watch has the lowest ratio of hardware costs to retail price of typical Apple products – other products the company has looked at have hardware cost to manufacturer retail price of 29 to 38 percent.
The Apple Watch is only 24 percent of the retail price.
There are, of course, other costs beyond the bill of materials (BOM) which IHS said include logistics, capital expenses, R&D, software, IP licensing and the like.
But even given that, it is a pretty healthy margin for Apple.
Apple has introduced new features and manufacturing in the Apple Watch Sport including a pulse oximeter, a force touch engine, and taptic engine feedback using a linear actuator.
The display is a plastic LG display.