What you need to know

  • A new teardown has a 512GB iPhone 11 Pro Max costing $490.50 to build.
  • Apple sells the phone for $1,449.
  • That’s around 66% profit.

That makes for a huge profit. But there’s more to it.

Whenever a new iPhone is released someone takes one apart and tries to work out how much it costs to build. The bill of materials (BoM) is always an interesting read and that’s certainly the case with iPhone 11 Pro Max. Once the phone was disassembled a $490.50 cost was calculated by Tech Insights.

According to the report the phone in question was a Midnight Green 512GB iPhone 11 Pro Max. And it was picked apart in the name of science. The results? Lots of tiny pieces that all look the same. But it’s the costs associated with those pieces that are interesting.

Take the camera and image processing hardware, for instance. Tech Insights calculates that to be the most costly collection of parts at $73.50. Following that we have the display at $66.50 with the impressive A13 Bionic chip coming in at $64. Add everything together, including final assembly and testing, and we get the $490.50 figure.

Considering this configuration is the most costly iPhone Apple sells – at $1,449 assuming no trade-ins – that means that Apple is pulling in around 66% profit for each of these handsets. At least, that’s what you might think.

But of course the BoM only tells part of the story. It can’t take into account shipping. Or the wages of the people who handle construction. Or the cost of the services that come free with an iPhone like iCloud syncing, AppleCare coverage with free support, and more. And advertising, of course. Those white rooms probably cost a fair bit to keep clean.

For a little context, Samsung’s 128GB Galaxy S10+ costs around $420 to make, again according to Tech Insights. That model costs $999 making the profit a reasonable 58%. Note the difference in storage capacity, though.

But of course Samsung’s BoM doesn’t include the intangibles, either. Which brings us back to my original point: these figures are interesting. But they can’t tell the whole story.

Original source: https://www.imore.com/512gb-iphone-11-pro-max-costs-less-500-parts