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Teardown shows Apple once again pays $200 to build an iPhone

Teardown shows Apple once again pays $200 to build an iPhone
Last week, we saw the first teardown of the new Apple iPhones, and now the estimations have come in on how much it costs Apple to build each new handset. In the past, the estimated cost of building an iPhone has never been over $200 (estimations ranged from around $188 to $199 for various iPhones), and while the iPhone 6 Plus reportedly cost Apple more than that to build, the iPhone 6 is right on target.

IHS has done the math, and is saying that the parts and labor to build an iPhone 6 is somewhere between $200 and $247, while the iPhone 6 Plus costs somewhere in the range of $216 to $263. The range of costs covers the various storage tiers. So, the 16GB iPhone 6 costs Apple $200 to build, and is then sold for $649. And, when you pay an extra $200 for the 128GB storage model, it is only costing Apple $47 for the larger NAND flash drive. This means Apple has profit margins of 69-70% on the new iPhones, and given the rate they are selling, that should bode well for Apple's quarterly earnings. For comparison, the Samsung Galaxy S5 cost about $256 to build and sold for $599.

As per usual, the most expensive component of the new iPhones are the displays. The iPhone 6 display and touchscreen costs $45, while the larger 6 Plus display and touchscreen costs $52.50. The A8 processor has had mixed results on benchmarks, but it has wowed researchers based on its technology alone. The A8 is built using a 20-nanometer process, meaning less battery draw, but it somehow is also more powerful. The A8 is estimated at $20 per chip, which is just $3 more than the cost of the A7. 

source: Re/code

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posted on 23 Sep 2014, 12:40 22

1. CX3NT3_713 (Posts: 2285; Member since: 18 Apr 2011)


$200 lol sold at $699

posted on 23 Sep 2014, 13:13 10

15. Finalflash (Posts: 3394; Member since: 23 Jul 2013)


That is the biggest advantage of an iPhone. Ask any ifan, it isn't about what you get from apple it is about what you give to them. Apple making massive profits off your back is the greatest advantage of the apple ecosystem. It is the last thing left that apple is ahead in. Now if only they could somehow patent profiteering and then all apple fans can rejoice on a permanent advantage instead of ones they keep losing to the competition.

posted on 23 Sep 2014, 13:17 6

16. irbaaz (Posts: 168; Member since: 27 Mar 2014)


And what about R&D and advertisement ...

posted on 23 Sep 2014, 13:46 10

27. vincelongman (Posts: 4884; Member since: 10 Feb 2013)


Also don't forgot most important feature, the Apple logo

posted on 23 Sep 2014, 13:47 2

28. rf1975 (Posts: 259; Member since: 01 Aug 2011)


But still lessthan Google glass margin.

posted on 23 Sep 2014, 13:50 1

31. EnigmaticPsychotic (Posts: 66; Member since: 26 Nov 2013)


I think the Glass pricing was more about getting the right people on to the new ecosystem.

posted on 23 Sep 2014, 13:53

32. InspectorGadget80 (unregistered)


most expensive parts ever.

posted on 23 Sep 2014, 14:00 5

34. Finalflash (Posts: 3394; Member since: 23 Jul 2013)


iFans don't get the fact that glass is largely a beta and development release right now for a moon shot project and future tech. They see the large price tag and feel jealous that they can't pay that kind of money to apple for tech from 5 years ago.

posted on 23 Sep 2014, 14:06 4

39. Slammer (Posts: 1515; Member since: 03 Jun 2010)


It amazes me that tech enthusiasts seemingly, are the most ignorant to how this company has operated for 30 years. Looking pretty doesn't equate to strudy. And a product that is carried an average of 14 hours a day, shouldn't be delicate.

In the 28 years of owning cellphones, I have never once had a problem with plastic. Not once. In fact, my Evo 4G is still going strong today for my Nephew.

John B

posted on 23 Sep 2014, 14:40 5

46. deepblack (Posts: 50; Member since: 09 Oct 2013)


Google uses money to invest their product.
Apple does nothing.

posted on 23 Sep 2014, 15:38

48. palmguy (Posts: 622; Member since: 22 Mar 2011)


Gave my son my 2011 sprint moto exprt(moto pro for vz). Put it on page plus. It has been dropped a million times without any case. A lil chipped around the screen but works just as well as the day I received it.

posted on 23 Sep 2014, 16:06

49. Pattyface (Posts: 1645; Member since: 20 Aug 2014)


Nope Google does all the right things, is never wrong and its products blend

posted on 23 Sep 2014, 16:21 3

52. engineer-1701d (unregistered)


what r&d its a old m8 prototype that was not used. why do you think the camera lens sticks out so much.

posted on 23 Sep 2014, 16:44 5

57. TheMoltenD (Posts: 109; Member since: 13 Jul 2014)


Steve Jobs was the greatest con artist in history, make them a device with other companies technology, make them feel like they are special for owning it and sell it for 2x what the competitors are selling similar devices for.

posted on 23 Sep 2014, 19:05 1

63. aksa123 (Posts: 333; Member since: 30 Jan 2014)


To cover up the multi-billion sapphire glass research.

posted on 23 Sep 2014, 20:52 1

68. Af1rPA (Posts: 711; Member since: 12 Jun 2014)


The same R&D team who allowed the iPhone 6 to bend in peoples pockets? $0.50 on R&D.

posted on 23 Sep 2014, 12:41 24

2. seanwhat (Posts: 284; Member since: 11 Jul 2013)


Can't believe they still get away with this. It's sad how many people come under the category of 'blind followers'.

posted on 23 Sep 2014, 12:42 7

4. fzacek (Posts: 2486; Member since: 26 Jan 2014)


Exactly...

posted on 23 Sep 2014, 13:24 5

19. frustyak (Posts: 214; Member since: 08 Mar 2010)


It seems to me that Apple gets singled out for this, yet Samsung, HTC, LG, Ford, General Motors, Volkswagen, etc do the exact same thing. It simple economics. Sellers want to sell their wares for as much as they can. Buyers want to buy the wares for as little as they can. Somewhere in the middle is where the seller is willing to sell for what the buyer is willing to pay, and that's what the item is worth.
It doesn't make iPhone owners 'blind followers' anymore than owning a Galaxy S5 makes someone a Samsung 'tool'.

posted on 23 Sep 2014, 13:39 8

24. Jobayer (Posts: 167; Member since: 22 Feb 2013)


I don't blame much on Samsung making so much profit since , it is always pushing the boundaries of tech . Sumsung is also one of the top spenders in R&D . You'r right it's doesn't make anyone fool for choosing Apple or Samsung . And it's good to have completion in the market but it would be more delighting to see them contribute to pulling the boundaries of tech .

posted on 23 Sep 2014, 13:45 2

26. seanwhat (Posts: 284; Member since: 11 Jul 2013)


Yes it does. They're blind followers because they don't consider any of that stuff, they just buy the phone. i know that because if they did consider any of that stuff, they wouldn't buy the phone and we wouldn't be having this discussion because they'd realise how much apple .rip them off compared to other companies.

posted on 23 Sep 2014, 13:58 2

33. vincelongman (Posts: 4884; Member since: 10 Feb 2013)


Exactly, that's an important reason why the Nexus are growing in popularity
Much fairer prices and quick updates

Though Google still charge $50 for a small upgrade in storage, but can't really complain since the initial price is much lower

posted on 23 Sep 2014, 14:53 1

47. PBXtech (Posts: 1032; Member since: 21 Oct 2013)


Costs get hidden in subsidized pricing from the carriers. It also explains why they sell massively in the US compared to other countries, the US subsidizes just about everything on the four top carriers.

posted on 23 Sep 2014, 18:46 3

62. joey_sfb (Posts: 6407; Member since: 29 Mar 2012)


Most companies will re-invest a large portion of their profits back into their businesses in the form of R&D, advertising and forming business partnerships. Its important because this create jobs for moms and dads.

All I hear from Apple side is they hogging up money in their Apple treasury. By this simple but extensive action could create an unbalances economy.

posted on 24 Sep 2014, 18:17

82. Neo_Huang (Posts: 1067; Member since: 06 Dec 2013)


And buying Beats.

posted on 23 Sep 2014, 12:41 13

3. fzacek (Posts: 2486; Member since: 26 Jan 2014)


What a rip-off. Apple is milking so much money out of consumers by charging $200 for a little more storage. Shameful...

posted on 23 Sep 2014, 13:30 3

22. elitewolverine (Posts: 5192; Member since: 28 Oct 2013)


A little more?

A 128GB card from Amazon for a class 10 extreme with tops out at 90MB/s transfer rate with adapter, meaning not phone speed but pc adapter speed, costs 130$

The memory in a phone, goes through more testing, yields are much different, materials used different, and the transfer rates range upwards of 200/MBs blowing sd cards out of the water by more than 2-5 fold in speed.

And they charge 200$ wow so evil of them.

posted on 23 Sep 2014, 14:34 7

44. BlankSpaceNai (Posts: 127; Member since: 23 Apr 2014)


Ha ha ha ha. I love when people try to do this..

You have to consider that the format apple uses for their devices are very specific in order to grant you that transfer rate, its a simple way of 'zipping' a file in order to create an easier to transfer file, then unzipping it at its destination instead of each one, one at at time. Thats not worth $200 my friend. Not only that, but the file types used in apple devices are rather different, sometimes larger than the normal.

You have to remember that apple doesnt do things the same way as everyone else. Although the numbers LOOK impressive, it doesnt mean that everything is the same under the hood. Does this mean apple is better? FOR apple users Yes, this is fantastic, for everyone else, you have software messing with all your stuff in order to make it 'better' for apples software.

posted on 23 Sep 2014, 16:25 1

53. engineer-1701d (unregistered)


what the hell are you talking about you may want to check the internet not the amazon internet that has higher prices then most. my 128 card cost 98 bucks.

posted on 23 Sep 2014, 16:44

56. av911 (Posts: 197; Member since: 19 Nov 2012)


And when you get a new phone next year, you'll have to pay the $200 again, when I can just move the 128GB microsd card over to my new phone. And if I want additional storage, I can buy more microsd cards.

What a great deal Apple is providing!!!!!

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