The iPhone series has always produced among the most expensive phones around. However, every year, we get the bill of materials and we end up surprised by how little the company spends on production relative to the retail price. For instance, the previous iPhones cost a little over $200 to build while they sell for $650 and above, the profit margins are astronomical.
This year, Apple went out of their comfort zone and built a futuristic device. It is logical to assume that the device cost them much more to produce hence its $999 price tag for the base 64GB model (The price of the 256GB is yet to be announced).
|Component||Cost in US dollars ($)|
|Samsung OLED Display||80|
|Apple A11 chip (10nm)||26|
|Toshiba 256GB internal storage||45|
|3D sensing (Face ID tech)||25|
|Minor internal components combined cost||158.5|
*Items in bold are only exclusive to the iPhone X.
Tables below shows each and every component, but in Chinese
As you can see from the table, the total cost of the phone is only $412.75 for the 256GB model. That puts the production cost at 60% below the retail price of $999 for the cheaper 64GB model, we can only imagine that the 256GB version will costs a lot more. It explains why Apple takes over 80% of all profits in the smartphone market globally. It is good to note that the bill of materials above does not account for costs of logistics, marketing, R&D and software development. Despite this, we believe that those remaining costs are lesser than the cost of components above.
The most expensive components is the Samsung made OLED display ($80) which is the main attraction of the phone. Make sure you do not break that screen, it will cost a lot more to repair. The 3D sensing tech, which makes Face ID unlocking possible, also ranks among the most expensive units ($25). Only these two components are exclusive to the iPhone X. So technically, it only costs $105 ($80+$25) more to build the iPhone X while compared to the other regular models, yet their prices differ by over $200.
The 3GB RAM that is also present on the iPhone 8 Plus doesn’t come cheap either ($24). Lastly the A11 processor and 256GB storage are both present in all versions of the new iPhones. Prices for the 256GB models haven’t been announced yet but expect them to be $150 to $300 above the base prices.