Tuesday, September 25, 2012

iPhone 5 BOM costs run from $199 to $230: IHS iSuppli

IHS iSuppli has done a physical teardown of the iPhone 5, and has estimated the bill of materials (BOM) and manufacturing cost for Apple's newest smartphone. Including manufacturing costs, the total iPhone 5 cost runs from $207 to $238, depending on the amount of device storage ($8 per device is allocated for assembly).

Costs are $207 for the 16GB model, $217 for the $32GB model, and $238 for the 64GB model.

In terms of unsubsidized pricing, Apple makes between $442 and $611 (with retail prices of from $649 to $849) on each device, not counting shipping, marketing, retail and other overhead expenses. According to IHS, Apple’s margins have actually improved on their highest-end 64GB devices, while mid- and lower-end iPhone 5s cost slightly more to manufacture than the iPhone 4S did at launch.

Compared to the iPhone 4S, Apple makes about $18 more on the 64GB model, $2 less on the 32GB model, and $11 less on the $16GB model.

These numbers are quite good, considering that the iPhone 5 has twice the RAM, new in-cell touch panels, a larger display, a new A6 processor, improved cameras, and LTE support.

Apple compensated for the increased costs by getting lower pricing on some components, such as batteries and wi-fi radio. In fact, NAND flash storage prices have been halved.

For the most part, Apple's suppliers remain the same as on the iPhone 4S, with one rather unsurprising exception: NAND flash memory. IHS says that Sandisk appears to be the iPhone 5′s key vendor for flash memory; in the past, Samsung has been Apple's key supplier.

Naturally, most are aware that with the multiple Samsung - Apple legal battles around the globe, Apple is trying to distance itself from Samsung, as much as possible.

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