iPhone XS Max teardown: Here's what $1,249 flagship costs Apple in parts

iPhone XS Max reportedly drops some 3D Touch components that are present in last year's iPhone X.

The iPhone XS Max with 256GB could be yours for $1,249, but if you were to buy all its components it would cost about $443, compared with $395.44 for the 64GB iPhone X.

The most expensive component in Apple's iPhone XS Max is its now the top-ranked 6.5-inch OLED display, which cost $80.50, according to a teardown by TechInsights. Surprisingly, that figure is less than $4 more than the iPhone X's smaller 5.8-inch display.

The analyst company told Reuters that Apple kept iPhone XS Max display costs down by removing some components related to its 3D Touch system, an accessibility feature, which would have cost about $10 more to include.

It had expected the cost difference to be larger given the iPhone XS Max's larger display.

"The OLED display in the iPhone XS Max is larger, increasing its cost, but that increase is tempered by the removal of some of the 3D Touch components that were previously found in the iPhone X," TechInsights reported.

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Al Cowsky of TechInsights told Reuters that its $80 display cost estimate would have been about $90 if Apple hadn't cut out the 3D Touch components."They had a trade-off in cost," said Cowsky.

So even though many consumers would balk at paying $1,249 for Apple's most advanced phone, the company is focusing costs on areas that matter. This week screen testing firm DisplayMate ranked the iPhone XS Max's display as the best that's ever been built.

TechInsights tear-down report cites other factors contributing to the iPhone XS Max costs, including Apple's 7nm a12 Bionic chip, a new GPU, an Intel baseband processor, new CMOS image sensors, and new Face ID components.

The iPhone XS Max's application processor is estimated to cost $72 compared with the iPhone X's $66.22 processor. Meanwhile, cameras cost $44 while mechanicals and housing cost $58.

All together, the components amounted to $443 for Apple's most expensive phone yet, which Apple CEO Tim Cook recently defended because people could "pay about $30 a month for it" in installments.

The large difference between the total cost of components and the retail price can in part be explained by factors not included in these analyses, such as R&D and sales, marketing, and distribution costs.

TechInsights was unable to confirm whether the iPhone XS Max was using an OLED display from LG Display.

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