The iPhone 7 features some of the most incredible tech found in a smartphone but the components only cost Apple about $220.
Including the basic manufacturing costs of $5, Apple’s total bill to manufacture the 32GB iPhone 7 reaches a total of $224.80, according to a teardown by IHS that found the device is $36.89 more expensive to produce than the iPhone 6s.
“Total BOM costs for the iPhone 7 are more in line with what we have seen in teardowns of recent flagship phones from Apple’s main competitor, Samsung, in that the costs are higher than in previous iPhone teardown analyses,” said Andrew Rassweiler, senior director of cost benchmarking for IHS.
At $43 a piece, the display on the iPhone 7 is the most expensive component. Intel’s LTE modem and other chips cost $33.90, while Apple’s A10 Fusion processor is only the third most expensive piece of hardware on the iPhone.
IHS estimates that both rear and front-facing cameras cost a combined total of $19.90. The new 1,902 mAh battery only costs $2.50. Minor components such as the Taptic Engine, antennas, connectors and speakers likely only cost a total of $16.70.
A full price breakdown of the iPhone 7 Plus still hasn’t been conducted, but with its bigger display, three cameras and extra RAM it will undoubtedly cut Apple’s margins a little thinner.
Buster Hein is a freelance writer who lives in Phoenix, Arizona. Twitter: @bst3r.
10 responses to “iPhone 7 components only cost Apple $220”
+taxes +software development +hardware development +client assistance +cable +earpods +boxes +shipping.
exactly. I hate when people talk about component costs. Any product requires a massive amount of cash to create before it’s manufactured.
I don’t trust made up numbers. They have no facts to prove they are correct.
Apple as a company operates at approx. a 40% gross margin as that is what they have for Cost of Goods, and retains about 20% Net Profits. Obviously, some of the products and services are going to be below and above these average margins, but I highly doubt these numbers are close to what Apple pays. Approximately 65% of Apple’s revenue is derived from iPhone sales, so I don’t doubt they have more than 40% Gross Margins on Cost of Goods sold, but $220 for a phone that has an MSRP of $650? I don’t think they have those kinds of margins.
I agree. Just thinking of Channel Marketing, R&D, Assembly, packaging, logistics and more. I am sure Apple is squeezing their suppliers as usual – but there are limits there as well.
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Yeah, and a facory or two for a couple of billions….
I’m not entirely sure what the author’s goal here is. Does he think someone can go out and purchase the parts used in an iPhone for $220. and build it themselves? Has he looked into the material cost of a hundred dollar bill?
Bought a fender for my bike the other day; 50 cents of metal and 50 cents of pain… 149 USD.
Outrageous! (irony)
Please do this article justice and build and iPhone 7 for $220. The embedded R&D? The manufacturing facilities? Transportation and logistics? Fucksake go after printer manufactures that charge more for ink than Chanel no. 5.
Jeez. And your body is only worth 97 cents. *Godzilla Facepalm*