According to results from a virtual teardown from IHS iSuppli that were made public recently, Apple pays an estimated $207 to build the base model 16GB iPhone 5 (a cost slightly higher than last year’s iPhone 4S). The market research company noted in its report that while previously-expensive NAND flash memory prices have dropped, the iPhone 5’s display technology and 4G LTE wireless components brings the build cost up to $207, or $8 more than consumer pricing after wireless carrier subsidies. This is in comparison to last year’s iPhone 4S which was estimated to be $188.
Added up, the iPhone 5 is estimated to have a BOM of $199, while the 32GB model rises to $209 and the 64GB version jumps to $230. With a manufacturing cost of $8 across the line, the final comes out to $208, $217, and $238 for the 16GB, 32GB, and 64GB models respectively. A report last Friday from UBM TechInsights pegged the 16GB iPhone 5’ BOM to be around $168, substantially lower than the IHS estimate. The most expensive part in the iPhone 5 is the new 4-inch display which comes in at $44. According to HIS Senior Principal Analyst, Teardown Services, Andrew Rassweiler:
The iPhone 5 makes a big evolutionary step in technology that we have not seen elsewhere with the use of in-cell touch sensing, most other smartphone LCDs use a completely distinct capacitive touchscreen assembly that is physically separate and placed on top of the display. The iPhone 5 partially integrates the touch layers into the display glass, making the product thinner and reducing the number of parts required to build display that senses touch without the need for a separate capacitive touch layer.
NAND flash continues to come down in price as manufacturing processes for these memory chips become more advanced and because it is the world’s largest buyer of NAND flash, Apple gets preferential pricing. Apple’s massive leverage in this market is reflected in our price estimate.
Source: IHS iSuppli via AppleInsider