A $849 64GB iPhone 5s only costs Apple $218 to build

Summary:Also, Apple charges customers $200 for a storage bump from 16GB to 64GB when the actual cost of the extra storage is $20.

The iPhone is a flagship handset, and as such it commands a flagship price. But one other thing that's flagship about the new iPhone 5s is the margin it pulls in for Apple.

According to a teardown analysis carried out analysts at IHS, a top-of-the-line 64GB iPhone 5s, which retails unlocked for $849, costs Apple a mere $218 to build, a price that includes the manufacturing costs.

The build price difference between this and the 16GB iPhone 5s is less than $20, and yet Apple charges consumers a whopping $200 for the extra 48GB of storage.

The single most expensive component inside the new iPhone 5s is the display assembly, which costs an estimated $41, while the wireless assembly costs an additional $32.

The sensors, which includes the gyros, compass, accelerometer and fingerprint reader only costs Apple $15, according to IHS, while the A7 and M7 processors are another $19.

iPhone 5s bill of materials
(Source: IHS)

A separate teardown analysis also shows that there's very little difference between the iPhone 5s and the plastic-backed iPhone 5c, and that includes the massive margin.

A 16GB iPhone 5c, which has a price tag of $549, costs Apple $173.45 to make. And, as you might suspect, given that there's only $25 between a 16GB iPhone 5s and an iPhone 5c with similar capacity, the components aren't much cheaper. The screen costs the same, as does the flash storage and the wireless assembly.

The A6 processor is only $6 cheaper than the 64-bit A7 and M7 motion coprocessor combined, and the battery is only $0.15 cheaper.

iPhone 5c bill of materials
(Source: IHS)

At their core, apart from the A7/M7 chips and the fingerprint reader, there's little to separate the two devices. 

Topics: Mobility, Apple, iPhone

About

Adrian Kingsley-Hughes is an internationally published technology author who has devoted over a decade to helping users get the most from technology -- whether that be by learning to program, building a PC from a pile of parts, or helping them get the most from their new MP3 player or digital camera.Adrian has authored/co-authored technic... Full Bio

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