If Apple had a huge defect rate wouldn't that ultimately show up in their financials? Wouldn't they have to expense all these defective iPhones?
This reminds me of all these shipped doesn't equal sold arguments but no one is ever able to show financial data on all these write offs of unsold phones.
1) They are not resold. They are taken apart by FoxConn.
2) Apple defers the cost to FoxConn. Or rather they don't pay FoxConn for defective phones, so the investigation should be in FoxConns financials, if any.
Of course there is a cost to Apple as these defects tend to happen in the first quarters of production, which Apple in their wisdom have decided to be in the busier part of the year, and so demand doesn't meet supply and customers are lost. Thats hard to estimate, because its a counter factual