Component Costs for the New iPhones Fall Between $173 and $218

Component Costs for the New iPhones Fall Between $173 and $218

According to an upcoming report, the iPhone 5c and iPhone 5s both cost between $173 and $218 each to produce.

iPhone 5s Teardown
iPhone 5s Teardown

AllThingsD:

According the findings of an IHS report coming tomorrow (but shared with AllThingsD today), Apple spends at least $191 on components to build a 16 gigabyte iPhone 5s. The cost rises to $210 for a 64GB unit. The cost of assembly adds another $8 per unit, bringing the range to between $199 and $218.

On the colorful, lower-priced iPhone 5c, IHS estimates that the cost of components plus manufacturing ranges from $173 to $183, including $7 for assembly. The 5c sells for between $549 and $649 without a contract. 

IHS analyst Andrew Rassweiler, who oversaw the teardown work, says the differences between the two devices are surprisingly few. “I would say that they’re almost the same phone, except that the 5s has the fingerprint sensor, the A7 processor and some newer memory chips that consume less power. Beyond that, they’re basically the same,” he said.

The teardown shows that the Apple used the same unique combination of RF chips in both the 5s and the 5c, at a combined cost of $32.

iPhone 5c Teardown
iPhone 5c Teardown

The similarities between the two phones are numerous: They have the same RF chips, the same display, the same cameras, the same flash-memory chips, etc.

The 5s does have the addition of a fingerprint sensor, a higher powered 64-bit A7 processor, and an extra LED flash for the camera.

The A7 is manufactured by Samsung, and its estimated it costs about $19 per unit. The A6 in the 5c is also made by Samsung, and runs about $13 per.

IHS estimates the cost for the fingerprint sensor in the 5s at around $7 per unit.

When approached by AllThingsD, Apple refused to comment on IHS’s cost estimates.

  1. Johnny Bleiss says:

    How do those numbers relate to gross margins? Will 5C really have a gross margin above 70%?

    1. That’s a great question. Considering the 5C’s low cost of parts and manufacture (notably, cheaper than the iPhone 5 would have been had Apple kept producing it), I would not be surprised if that were indeed accurate.

      1. Johnny Bleiss says:

        I think they have historically been around 48-53%, so a jump to 70% would make for a drastic EPS surprise! …add to that C4Q volumes above consensus….

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